PITTSBURGH, PA - Mayor William Peduto announced today that Pittsburgh is set to work with the Commonwealth and Act 47 coordinators to write an amended recovery plan that will outline the final exit strategy out of its financial woes, though an Act 47 decision by Gov. Tom Corbett.
The governor’s call for a new long-term financial plan for the city through the Municipalities Financial Recovery Act will enable the Mayor to craft a final five-year financial strategy that gets Pittsburgh out of budget trouble once and for all.
The new plan that will be issued this spring to City Council will extinguish Pittsburgh’s long-ignored problems of debt, pensions, spending and investment for good.
“Two months ago upon taking office, I said that when I announce that our city’s financial challenges are past us, it will be a declaration grounded in reality and not wishful thinking. The governor’s decision to continue Act 47 assistance brings that day a step closer,” Mayor Peduto said.
The Mayor is looking forward to working further with the city’s Act 47 coordinators at Eckert Seamans and Public Financial Management, and the Intergovernmental Cooperation Authority, on the effort.
“This decision will allow us to start down a new path that will leave our city truly fiscally sound for generations to come, and to build, from the ground up, the government for the Next Pittsburgh. With leadership at the state and local level -- and the shared sacrifices that our city employees and residents have made -- we are finally within reach of making this a reality,” Mayor Peduto said.
He thanked the Governor for coming back home to make the important announcement.
“Thank you Governor Corbett for your leadership in this manner. I appreciate that the governor understands the pivotal role cities play in Pennsylvania’s economy. I know personally that when asked where “home” is, people who live in Scott, or Stowe, or Shaler will often answer ‘Pittsburgh.’”
In accordance with Act 47, Department of Community and Economic Development Secretary C. Alan Walker has determined that the City of Pittsburgh has not met the criteria for a rescission of its Act 47 status as provided for in both Section 253 and the Policy Statement of the Act 47.
This will be the city’s third Act 47 plan, following initial adoption in 2004 and an amended plan in 2009.
The plans set out a financial framework with budget projections over five years and contain suggested operating improvements for cities. Through efforts such as intergovernmental cooperation and economic development, the operating improvements can help cities meet the budget projections set forth in other parts of the plan.
(The Mayor’s full comments, as prepared for delivery, are below. Here is a link to a presentation he delivered.)
Remarks by Mayor William Peduto on Act 47, March 13, 2014:
"Two months ago upon taking office, I said that when I announce that our city’s financial challenges are past us, it will be a declaration grounded in reality and not wishful thinking. The governor’s decision to continue Act 47 assistance brings that day a step closer.
Today we step out out of the black hole of city budgeting and into the light. Old problems that were pushed off, with good money thrown after bad, will be eliminated. No longer will Pittsburgh limp by year after year: through a new approach, in the next five years we will be on a course of financial security that addresses our long-term, long-ignored problems of debt, pensions, spending and investment.
This won’t be just an exit strategy for the next five years, but an entry for the next 20.
It will eliminate some old positions in city government, and replace them with new ones that better reflect 21st century Pittsburgh. It will institute a 10-year plan will address all our assets: paving more streets and building playgrounds; rethinking our city facilities, from warehouses to parking lots; and developing better ways to manage our fleet, including Public Works and Public Safety vehicles. This plan will hold city government accountable by instituting performance-based budgeting standards. It will assure our employees that their pensions are safe for when they need them. And it will bring in new revenues, even while we cut the cost of doing government.
None of this can be done without our long partnership with the state and Gov. Corbett.
I appreciate that the governor understands the pivotal role cities play in Pennsylvania’s economy. I know personally that when asked where “home” is, people who live in Scott, or Stowe, or Shaler will often answer “Pittsburgh.”
And the greater Pittsburgh region is just that -- a collection of communities and different people who understand that the city is the region’s hub, its economic center, and an irreplaceable part of the region.
So, thank you Gov. Corbett for your leadership on this matter. Pittsburgh, we are on the real road to financial recovery, and while that journey is taking time, the new expectations we begin today will ensure a brighter and smarter future.
In short, the same way I am bringing sunshine into the dark corners of city government, our plan will set the new expectations for Pittsburgh’s finances that will bring a brighter future.
A decade ago the outlook was dark. Our city had to decide between financial ruin and seeking the state’s help to forge another path. It wasn’t easy, but in order to preserve the city we love for our residents, our workers and business community alike, I rallied the votes together to enter Act 47 and get the assistance we needed.
Now we are poised to take the final step. This decision will allow us to start down a new path that will leave our city truly fiscally sound for generations to come, and to build, from the ground up, the government for the Next Pittsburgh. With leadership at the state and local level -- and the shared sacrifices that our city employees and residents have made -- we are finally within reach of making this a reality.
With state help we can end pension spiking, bring fairness to public safety retirement and arbitration rules, and apply common sense to the formula for state pension aid to municipalities.
By working with Allegheny County, we will find more ways to share services and save taxpayers tens of millions over the next decade.
Working alongside the Act 47 and Intergovernmental Cooperation Authority teams we can finish the job on debt management, direct more money into pension and capital needs, and significantly reduce our debt obligations by 2018.
And in proving our new budget strength and showing this pathway to recovery -- with the transparency that is my administration’s hallmark -- our nonprofits will help us complete the comeback. By coming together and agreeing on a long-term and strategic funding model, our major nonprofits can shoulder their responsibilities for paying for city services, while being confident their funding is being spent wisely and for the long-term health of our city."
Thursday, March 13, 2014
City of Pittsburgh
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