Free Utilities for Waterworks Restaurant

[seand]

Would like more water with your meal? Its free, I mean really, really free - for us.

The high-end eatery leases space in a historic city-owned building near the Philadelphia Museum of Art. It has crystal chandeliers, $39 dinner entrées, and an outdoor deck with a stunning view of the Schuylkill River.

Why would the fancy place need taxpayers to cover its bills? Robert Allen, Parks & Recreation’s property and concessions management director, initially said the city wasn’t and first deputy commissioner Mark Focht said he didn’t “know of any facilities in Parks & Recreation’s system where the city is paying utilities for for-profits.”

But, after probing by “It’s Our Money,” the city has acknowledged that taxpayers have footed the hefty bill for Water Works Restaurant for the majority of its six-year existence and the Nutter administration has launched an investigation.

Allen said that the city paid for electricity, gas and water for Water Works from its opening in 2006 until 2010, and then again for about the past year. Electricity for that year alone cost taxpayers $70,000, according to mayoral spokesman Mark McDonald, and he estimates taxpayers have paid $225,000 on electricity since its opening.

The total paid on all utilities is likely in the hundreds of thousands of dollars. Allen said he couldn’t provide an accurate number because Water Works shares its city-owned building with a Water Department museum, and the equipment needed to measure each entity’s utilities wasn’t installed until 2010.”

Water Works Restaurant has been the site of political fund-raisers for Nutter and Sen. Bob Casey, as well as a primary party for then-candidate Barack Obama. Karloutsos also ran the 2002 Illinois gubernatorial campaign for Paul Vallas, former Philadelphia schools CEO, and was later a consultant for the district.

Karloutsos said Water Works would pay for its utilities as soon as it received a bill. He vehemently denied that his connections had anything to do with the city picking up the tab.

You got hosed: Taxpayers foot bill for Water Works Restaurant

Glad our Controller has been right on this.

[Tartan69]

While you can probably question their ethics somewhat, you can't really fault the restaurant people for not paying something that wasn't billed to them. The real question is how L&I and the utilities approved the permits for the restaurant to be built out in the existing space and opened for business to the public without separate utility metering being installed?

[seand]

Agreed this probably a result of a string of incompetence rather than a nefarious plot, but it does say a lot about how the city fails at the basics when it comes to collecting revenue and financial oversight all too frequently.

[raider.adam]

Easy solution is to stop paying for utilities of for profits and not-for-profits. That way you know everyone should get a bill.

[annie]

Agreed this probably a result of a string of incompetence rather than a nefarious plot, but it does say a lot about how the city fails at the basics when it comes to collecting revenue and financial oversight all too frequently.

Philadelphia pays utility bills for connected owner's second restaurant

Once, okay, maybe. BUT TWICE?!

[seand]

Philadelphia pays utility bills for connected owner's second restaurant

Once, okay, maybe. BUT TWICE?!

Breaking News: City employees found to be secretly pumping gas into connected restauranters car. Karloutsos responds "I just thought I was getting really, really good mileage."*

(*sarcasm)

[billy ross]

Philadelphia pays utility bills for connected owner's second restaurant

Once, okay, maybe. BUT TWICE?!

How much is the rent on the space at the Waterworks? How was the rental amount arrived at?

The problem here is that for decades the city allowed Fairmount Park buildings to sit vacant because the papers ran 'exposes' about how insiders were getting sweetheart deals with cheap rent on gorgeous spaces in the Park, mostly for housing for their families. The city decided to end the 'scandal' by simply vacating the properties and quite a few of them then went derelict and were demolished. The Cliffs burned down and is now a ruin, for instance. Realizing that that was a stupid plan, the city more recently decided to get operators to lease city-owned spaces, but the city doesn't know how to be a landlord and it isn't set up for it. As time goes on it'll get the hang of it and be able to turn these derelict city-owned properties into proper cash flows. I've noticed more and more shutters being opened up on Fairmount Park mansions, for instance, although it's scandalous how many of them are simply literally shuttered still. No bureaucratic operation can learn new skills without bumps in the road. Both of these buildings are city-owned, and the city doesn't know how to backcharge for utility use, nor does it have the money in its capital budget to split utilities. What I do when faced with this situation is I raise the rent by what I feel is reasonable and then throw utilities in with the rent, and I try to take reasonable steps to keep my utility bills reasonable.

Think of how much money the city is leaving on the table by not renting out ground floor space at City Hall or on Center/Penn Square to private operators. How much money is the city leaving on the table? Why is City Hall not a huge tourist destination? Because of crap like this. The city could charge a premium for ground-level space and put those functions which presently use the space in cheaper non-ground-level space. Just think of things like a Ratskeller, for instance.

[annie]

(*sarcasm)

I do not like this trend of a *sarcasm. Takes of the fun out of it and prevents the idiots from identifying themselves.