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Nutter Warns Of More Cuts In City Services As Tax Revenues Tumble

PHILADELPHIA (CBS) - Mayor Michael Nutter is sounding a warning cry that the city's economy is again slowing, thanks mainly to higher unemployment.

And he says the resulting drop in tax revenues could result in more difficult budget cuts this fall.

Philadelphia's tax revenues had actually been heading upward for about year, at a level that the Nutter administration says was consistent with the national economy.  But what worries Nutter and his budget experts are declining tax revenues in July and August, specifically in the areas of wage and sales taxes.

The mayor spelled out his concerns in a letter to the controller, and says this could force him to slash city services.

Read Mayor Nutter's Letter to Controller Butkovitz (.pdf format)

"We will certainly have to look at all of those, either cost reductions or spending restraint strategies, if these kinds of trends continue," he told KYW Newsradio this morning.

The porject shortfall if trends continue is put at $60 million, including declines in the value of the city worker pension fund.

Nutter says he'll wait until September figures are in before making any decisions about cutting the budget.

Reported by KYW City Hall bureau chief Mike Dunn

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