DIRECTOR OF FINANCE

Philadelphia Home Rule Charter art. VI, ch. 1

in effect

Philadelphia Home Rule Charter § 6-100 In General.

§ 6-100. In General. The Director of Finance shall be the chief financial, accounting and budget officer of the City. ANNOTATION Sources: No specific source. Purposes: The office of Director of Finance is created to give the Mayor and the City government a principal officer responsible for the financial, accounting, and budgeting functions of the executive branch. The Director of Finance is thus the chief financial officer of the City and all powers and duties concerning finances, accounting, and budgeting in the executive branch are directly or indirectly his with the following exceptions: The custody of City funds and their actual payment out of the City treasury remain with the City Treasurer who is independent of the Director of Finance until City-County consolidation. When the Constitution and laws of the Commonwealth permit, the City Treasurer is to be appointed by the Director of Finance (Section 3-202) and at that time the Director of Finance will supervise these functions as well as the others for which he has responsibility. The functions of the City Controller are not under the supervision of the Director of Finance. The customary independence of an auditor would not be maintained if the City Controller were made subject to the supervision of the Director of Finance.

Philadelphia Home Rule Charter § 6-101 Accounts.

§ 6-101. Accounts. The Director of Finance shall establish a general accounting system for the City government. The Director shall: (a) Keep separate accounts of each item of appropriation made to any officer, department, board or commission of the City, to any other governmental officer or agency and to any other person, association or corporation. Each such account shall show the amount of the appropriation, the amounts paid therefrom, the unpaid obligations against it, and the unencumbered balance; (b) Have complete supervision over the keeping of detailed accounting records by officers, departments, boards, commissions, agencies or others receiving appropriations from the City. After consultation with the City Controller, the Director shall devise, and from time to time improve, a uniform system of accounting for all officers, departments, boards and commissions of the City and other governmental agencies receiving appropriations, and shall require such system to be installed and maintained by all such officers, departments, boards, commissions and agencies. Such system shall avoid duplication of records and of bookkeeping to the greatest extent possible consistent with the provisions of this charter and the safeguarding of the City's finances; (c) Supervise the accounting for all moneys received and receivable by the City from any source whatever. The Director shall require the accounting in the Department of Collections to be done by modern and economical methods, including the use of mechanical equipment, and with adequate safeguards to prevent irregularity or laxity in the recording both of moneys received and of moneys due; (d) Reflect in the accounts in the Director's office the amounts collected by the Department of Collections, as shown by the daily reports of the Department of Collections; (e) Issue within one hundred and twenty days after the close of each fiscal year a statement as of the end of that year showing the balances in all funds of the City, the amounts of the City's known liabilities, and such other information as is necessary to furnish a true picture of the City's financial condition. ANNOTATION Sources: See Act of June 25, 1919, P.L. 581, Article XII, Section 3, as amended; the Administrative Code of 1929, Act of April 9, 1929, P.L. 177, Section 701, as amended. Purposes: 1. A primary function of the Director of Finance is to establish, maintain and supervise an adequate and modern accounting system for the City. Under the 1919 Charter this was a function of the City Controller shared by various agencies of the executive branch. Experience under that Charter demonstrated the inadequacy of the system which it provided. To remedy this condition, the Director of Finance is placed in over-all charge of City accounting. He is to establish a general accounting system for the City. He is to maintain primary accounts showing the appropriation made to each officer and agency, how much of it has been spent, how much of it has been obligated but unpaid, and any unencumbered balance remaining. This will afford each officer and agency a day to day picture of the state of appropriations and City expenditures. 2. Detailed accounting records are to be maintained by the various officers and agencies receiving City appropriations, but the accounting system is to be devised by the Director of Finance for the purpose of assuring a uniform, accurate and efficient system for the entire City. Consultation in the establishment of such a system with the City Controller is required because the City Controller will have to audit the records maintained and they should reflect those items which the City Controller will have to look for. While there is a caution that the detailed accounting records shall in so far as possible avoid duplication with those maintained by the Director of Finance, the extent to which duplication is required will avoid any system whereby essential accounting records are maintained by only one agency. 3. The Director of Finance is charged with the duty of supervising the accounting for all moneys received and receivable by the City and this function is emphasized because the accounting for City receipts in the past has left much to be desired. Efficiency and accuracy of such accounting may be aided by the use of modern mechanical equipment and the Charter requires the use of such equipment. In addition, the Director of Finance is required to keep a day to day balance in his office based on reports of the Department of Collections. This will show the flow of receipts and, together with the Director's records of the flow of expenditures, will readily furnish information about the over-all financial position of the City. 4. The Director of Finance is required to prepare an annual financial statement which will, by showing balances in City funds, City liabilities, and other pertinent information, afford a true picture each year of the City's financial position. Notes 226 | Amended by approval of the voters at the election held on May 17, 2022, and certified on June 6, 2022. See Bill No. 220001 (approved February 25, 2022); Resolution No. 220009 (adopted February 24, 2022).

Philadelphia Home Rule Charter § 6-102 Inventory Accounting.

§ 6-102. Inventory Accounting. The Director of Finance shall: (a) Be responsible for the maintenance of a perpetual inventory in the Procurement Department and in every department, board or commission of the City or other governmental agency having possession of unissued stores of City property. The Director shall devise, install and supervise the operation of systems under which withdrawals from and replacements in stores will be currently recorded and reported to the Director's office. The Director shall have supervision over the periodic (at least twice annually) counting, weighing or measuring of inventory quantities; 227 (b) Supervise the making of inventory lists of furniture and equipment by every officer, department, board, commission or other agency having possession of City owned property. The inventory lists shall be signed by such officer or by the head of such department, board, commission or other agency. The Director shall devise a system under which additions to and withdrawals from such furniture or equipment shall be currently recorded, and shall have supervision over the periodic (at least annually) counting of such furniture and equipment, and the reconciliation of such counts with the City's perpetual inventory records. ANNOTATION Sources: No specific source. Purposes: Adequate records accounting for the City's property will afford an opportunity for effecting economies in the acquisition of new property and will result in the strict accountability of any person or agency charged with City property. To achieve this goal, the Director of Finance is required to maintain a perpetual inventory of unissued stores of the City and to install an accounting system whereby the status of such inventories will be maintained currently and will be known to his office. This system of inventory accounting is to include a physical inventory at least twice a year to assure its accuracy. A similar inventory procedure is required of every officer and agency of the City having furniture and equipment in his or its possession. Notes 227 | Amended by approval of the voters at the election held on May 17, 2022, and certified on June 6, 2022. See Bill No. 220001 (approved February 25, 2022); Resolution No. 220009 (adopted February 24, 2022). The phrase "recorded and reported to his office" was changed by the Code editor to read "recorded and reported to the Director's office" to be gender neutral consistent with the broad Charter change set forth in the May 17, 2022 referendum.

Philadelphia Home Rule Charter § 6-103 Clearance of Requisitions for Purchase of Equipment, Material and Supplies.

§ 6-103. Clearance of Requisitions for Purchase of Equipment, Material and Supplies. The Director of Finance shall from time to time determine whether equipment, material or supplies are presently available so as to render unnecessary contemplated purchases of additional equipment, material or supplies. To enable the Director to perform this function, the Procurement Department shall submit to the Director every proposal for the purchase of equipment, material or supplies except any purchases involving an expenditure of less than such an amount as may be fixed from time to time by order of the Administrative Board. It shall not be lawful to invite bids for any purchase exceeding the exempted amount without first obtaining prior approval from the Director of Finance. ANNOTATION Sources: No specific source. Purposes: Economies in the expenditure of City funds are often achieved if inventory records show that property requisitioned for purchase is presently available and unused by some other officer or agency. The purpose of this section is to provide a procedure whereby purchases above a certain amount may be so screened. It would be too great a burden on the Director of Finance to require him to screen every purchase and, therefore, the Administrative Board is designated as the agency to determine the amount above which purchases are to be screened. Notes 228 | Amended by approval of the voters at the election held on May 17, 2022, and certified on June 6, 2022. See Bill No. 220001 (approved February 25, 2022); Resolution No. 220009 (adopted February 24, 2022).

Philadelphia Home Rule Charter § 6-104 Contracts.

§ 6-104. Contracts. Before any contract shall be effective, the Director of Finance shall approve it as to the availability of appropriated funds. The Director shall designate on every such contract, the appropriation under which it is made and shall give it a number in the order of its date. The Director shall, in the order in which each contract is numbered, charge the appropriation out of which expenditures thereunder will be made. ANNOTATION Sources: Act of June 25, 1919, P.L. 581, Article XII, Section 4. Purposes: The Director of Finance is required to approve all contracts as to the availability of funds so that obligations will not be incurred in excess of available appropriations. While the expenditure of moneys under a contract may be deferred, prudent accounting requires funds in the appropriation to be set aside for the obligation incurred. See also Section 8-104. Notes 229 | Amended by approval of the voters at the election held on May 17, 2022, and certified on June 6, 2022. See Bill No. 220001 (approved February 25, 2022); Resolution No. 220009 (adopted February 24, 2022).

Philadelphia Home Rule Charter § 6-105 Annual Operating Budget, Capital Program and Capital Budget.

§ 6-105. Annual Operating Budget, Capital Program and Capital Budget. The Director of Finance shall: (a) Obtain from all officers, departments, boards and commissions and other agencies receiving appropriations from the City such information as shall be necessary to enable the Director to compile for the Mayor the information necessary for the preparation and submission to the Council of the annual operating budget; 230 (b) Not later than six months prior to the end of each fiscal year, distribute to the Mayor, the Managing Director, the Personnel Director, each department, board and commission of the City, the chief clerk of the Council and all other officers of the City and other governmental or other agencies which desire City appropriations to be made to them, the proper blanks necessary for the preparation of operating budget estimates, with a request that such blanks be returned with the information desired not later than five months prior to the end of the fiscal year. Such blanks shall be in such form as shall be prescribed by the Director of Finance to procure any and all information pertaining to the revenues and expenditures for the preceding fiscal year and for the current fiscal year, including the appropriations made by the Council for the previous year, the expenditures therefrom, the encumbrances thereon, the amount unencumbered and unexpended, itemized estimates of the revenues and expenditures of the current fiscal year and for the succeeding fiscal year, and an estimate of the revenues and amounts needed for expenses of the Council, and for all offices, departments, boards and commissions of the City and other governmental or other agencies to which appropriations are likely to be made by the Council for the next fiscal year. Such blanks shall also request the person returning them to accompany them with a statement in writing, giving the facts and an explanation of and reasons for the estimates of receipts and expenditures for the succeeding fiscal year contained upon the blanks returned; (c) Under the direction of the Mayor, make inquiries and investigations as to the financial needs, expenditures, estimates or revenues of any officer, department, board or commission of the City or other agency requesting appropriations from the City. The Mayor may, after giving to each such officer, department, board, commission or other agency an opportunity to be heard, approve, disapprove or alter the estimates. The Director of Finance shall submit to the Mayor, in writing, the above information and any additional information requested by the Mayor as a basis for the Mayor's estimates for appropriations for the next fiscal year; (d) Obtain annually from all officers, departments, boards and commissions and other agencies requesting funds from the City for capital improvements, such information as the City Planning Commission shall require to enable it to prepare the capital program and capital budget; (e) Prepare and supply to the Mayor such information as will enable the Mayor to keep currently acquainted with the financial conditions and prospective receipts and expenditures of the City during the current fiscal year in order to control expenditures in such a manner as to avoid deficits. (f) By the time of the submission by the Mayor to City Council of the proposed operating budget ordinance, proposed capital budget ordinance, and proposed capital program, provide to City Council such additional information as Council may from time to time require pursuant to Section 2-310. 231 ANNOTATION Sources: The Administrative Code of 1929, Act of April 9, 1929, P.L. 177, Section 601. Purposes: 1. The Director of Finance is to be in over-all charge of the preparation of the annual operating budget so that it may be prepared in an orderly and efficient manner and so that it will reflect all possible economies. Thus, he has the duty of gathering from all officers and agencies of the City all the information necessary for the preparation of the budget. He may request any officer or agency to justify the information furnished either as to expenditures requested or revenues estimated. It is to be noted that since the Director of Finance is the principal financial assistant of the Mayor, the Mayor is ultimately responsible for the budget, and for this reason the Director of Finance will act under the direction of the Mayor, to the extent that the Mayor deems it appropriate to give such direction. The Mayor is empowered to make the final decision as to the content of the operating budget to be submitted to the Council. 2. The Director of Finance is also to gather information required by the City Planning Commission in the preparation of the capital program and capital budget since, as the City's chief financial and budget officer, he will be in a position to obtain such information. 3. The Director of Finance is required to gather and compile information which will enable the Mayor to know at all times the financial condition of the City. One of the purposes of this requirement is to enable the Mayor to be in a position to reduce expenditures in the event the flow of revenues indicates a deficit may be or is about to be incurred. Section 8-102. Notes 230 | Amended by approval of the voters at the election held on May 17, 2022, and certified on June 6, 2022. See Bill No. 220001 (approved February 25, 2022); Resolution No. 220009 (adopted February 24, 2022). 231 | Added by approval of the voters at the election held on November 6, 2012, and certified on December 3, 2012. See Bill No. 120108 (approved September 11, 2012); Resolution No. 120119 (adopted June 28, 2012).

Philadelphia Home Rule Charter § 6-106 Requisitions for the Payment of Money.

§ 6-106. Requisitions for the Payment of Money. The Director of Finance shall receive for transmittal to the Auditing Department every requisition for the payment of money out of the City Treasury. The Director shall examine the requisition to see whether there is an appropriation available for the requested expenditure and whether the requisition is in accordance with any administrative order of the Mayor relating to current expenditures. If the requisition is proper in these respects, the Director shall note approval thereon and transmit it to the Auditing Department; otherwise the Director shall return it to whence it came. However, if any officer, department, board, commission or agency has failed to comply with the Director's accounting requirements, the Director may decline to approve any requisition for the payment of money out of any appropriation to such officer, department, board, commission or agency until compliance. The Director shall keep among the Director's records copies of all requisitions approved for payment. ANNOTATION Sources: Act of June 25, 1919, P.L. 581, Article XII, Section 3, as amended; see also the Fiscal Code of 1929, Act of April 9, 1929, P.L. 343, Section 1502. Purposes: All requisitions for the payment of money are required to pass through the office of the Director of Finance in order to make certain that appropriations are available for proposed expenditures and so that they may be checked for conformity to current orders of the Mayor dealing with current expenditures. If these requirements are met, and if the officer or agency initiating a requisition is conforming with the Director of Finance's accounting requirements, the Director of Finance will approve the requisition. Disapproval is permitted where there is a failure to comply with the Director's accounting requirements since this is an effective means for assuring such compliance. Copies of all requisitions are to be retained by the Director of Finance to aid his general accounting system. Notes 232 | Amended by approval of the voters at the election held on May 17, 2022, and certified on June 6, 2022. See Bill No. 220001 (approved February 25, 2022); Resolution No. 220009 (adopted February 24, 2022).

Philadelphia Home Rule Charter § 6-107 Cost Analysis.

§ 6-107. Cost Analysis. The Director of Finance shall from time to time make studies of the cost of performing the various functions which are committed to the several officers, departments, boards or commissions or other agencies. Such studies shall be made on such basis as the Director of Finance may deem useful or as the Mayor or the Managing Director may request. Reports showing the results of such studies shall be made to the Mayor and to the Managing Director. ANNOTATION Sources: No specific source. Purposes: Cost analysis is required so that the cost of performing various City operations will be known. Such knowledge will make possible the effecting of economies where costs appear to be excessive and the reviewing of costs in those cases where charges are made for services rendered by the City. Cost analysis information is to be supplied to the Mayor, because he is the chief executive, and to the Managing Director, because he will be supervising the service departments and should know the cost of their various operations for effective supervision.

Philadelphia Home Rule Charter § 6-108 Examination of Records and Property.

§ 6-108. Examination of Records and Property. To enable the Director of Finance to perform the Director's duties as provided in this Chapter, the Director shall have access to the records of every officer, department, board or commission of the City or other governmental agency to which appropriations are made by the City, and shall have the right to examine at any time the equipment, material or supplies acquired with such appropriations and in the possession of any such officer, department, board, commission or agency. ANNOTATION Sources: No specific source. Purposes: The Director of Finance is given the right to examine all records and property of any officer or agency to which appropriations are made so that he may properly discharge his duties. Notes 233 | Amended by approval of the voters at the election held on May 17, 2022, and certified on June 6, 2022. See Bill No. 220001 (approved February 25, 2022); Resolution No. 220009 (adopted February 24, 2022).

Philadelphia Home Rule Charter § 6-109 Disadvantaged Business Enterprises.

§ 6-109. Disadvantaged Business Enterprises. (1) At least thirty (30) days before the start of each fiscal year, the Finance Director shall file with the Mayor a written report that includes: (a) An up-to-date study analyzing the participation of disadvantaged business enterprises ("DBE's") in City contracts for the purchase of goods and services, compared to the percentage of qualified DBE's available to participate in such contracts ("Annual Disparity Study"). The Annual Disparity Study shall be performed either by the Office of the Director of Finance itself, or by contract. (b) City contract participation goals for DBE's for the upcoming fiscal year ("Annual Participation Goals"). In devising the Annual Participation Goals, the Finance Director shall consider: (i) the present availability of qualified DBE's; (ii) the participation of qualified DBE's on past contracts awarded by the City; (iii) a forecast of eligible contracts to be awarded within the fiscal year; and (iv) the latest Annual Disparity Study. (c) Such other related matters as Council may from time to time ordain. (2) At the same time that the report is filed with the Mayor, the Finance Director shall file a copy with the Department of Records and with the President and Chief Clerk of Council, and shall arrange for publication of the report on the City's official website. (3) Council may by ordinance define and detail categories of DBE's and of City contracts that must be considered separately by the Finance Director in conducting the Annual Disparity Study and devising the Annual Participation Goals. Notes 234 | Added by approval of the voters at the election held on November 7, 2006, and certified on November 27, 2006. See Bill No. 060388 (approved June 13, 2006); Resolution No. 060408 (adopted June 1, 2006).

Philadelphia Home Rule Charter § 6-110 Budget Stabilization Reserve.

§ 6-110. Budget Stabilization Reserve. (a) The Director of Finance shall create and maintain a Budget Stabilization Reserve as a separate fund which shall not be commingled with any other funds of the City. For each fiscal year, the Director of Finance shall make deposits to such Fund no later than three months after the start of such year in such amount as may be necessary to increase the balance in the Budget Stabilization Reserve to the amount appropriated by the Council to the Budget Stabilization Reserve pursuant to Section 2-300(7). (b) The Director of Finance shall invest the moneys deposited in the Budget Stabilization Reserve in like manner to other moneys in the General Fund not needed for immediate expenditure by the City. Interest and other earnings on such money shall accrue to the Budget Stabilization Reserve. (c) The Director of Finance shall allow withdrawals from the Budget Stabilization Reserve only upon (i) approval by ordinance of a transfer of appropriations from the Budget Stabilization Reserve, pursuant to Section 2-300(6), and only for the purposes set forth in such transfer ordinance; and (ii) either: (1) A certification by the Director of Finance that General Fund Revenues actually received by the City during the prior fiscal year were at least one percent (1%) less than the General Fund Revenues set forth in the Mayor's estimate of receipts pursuant to Section 2-300(3); or (2) A certification by the Director of Finance that such withdrawal is necessary to avoid either a material disruption in City services or to fund emergency programs necessary to protect the health, safety or welfare of City residents; and that it would be fiscally imprudent to seek emergency appropriations pursuant to Section 2-301(a). Such certification must be approved either by (i) a resolution adopted by two-thirds of all of the members of the Council, or (ii) an agency of the Commonwealth with responsibility for ensuring the fiscal stability of the City. (d) Expenses incurred or to be incurred as a result of any interest arbitration award, to the extent such expenses exceed those anticipated by the Director of Finance in the most recent financial plans submitted to any State agency prior to the issuance of such award, or, if no such plans have been submitted within the immediately preceding twelve months, in the most recent financial plans certified to the Council by the Director of Finance, shall not be considered in determining the need for any withdrawal from the Budget Stabilization Reserve. (e) The Director of Finance shall set forth a projection of the status of the Budget Stabilization Reserve in any Five-year Plan the Director prepares. 236 _______________ Notes 235 | Added by approval of the voters at the election held on November 9, 2011, and certified on November 28, 2011. See Bill No. 100303 (approved April 27, 2011); Resolution No. 100314-A (adopted April 14, 2011). 236 | Added by approval of the voters at the election held on May 16, 2023, and certified on June 5, 2023. See Bill No. 220733 (approved March 1, 2023); Resolution No. 220743 (adopted February 16, 2023). See Charter subsection A-200(25) for effective date.

Source: City of Philadelphia, The Philadelphia Code and Home Rule Charter (American Legal Publishing, codelibrary.amlegal.com)URL: https://codelibrary.amlegal.com/codes/philadelphia/latest/philadelphia_pa/0-0-0-265259Fetched: 10/27/2026