PITTSBURGH, PA (April 20, 2020) Mayor William Peduto has issued a letter to President Donald J. Trump urgently asking for $250 billion in emergency funding for Pittsburgh and other cities fighting the COVID-19 pandemic.
“As your administration has stressed since the outbreak of COVID-19, while the emergency response effort is federally supported, it must be locally executed. The City of Pittsburgh is working hard to meet the needs of our residents, while suppressing the spread of COVID-19. As Pittsburgh continues to grapple with this crisis, I strongly urge you to support the inclusion of $250 billion in flexible funding for local governments in a future emergency coronavirus relief package,” Mayor Peduto wrote.
Pittsburgh and similar cities host the largest health systems in their regions, and employ the medics, police, refuse collectors and other workers on the front lines battling the pandemic. They also host great numbers of residents and businesses reeling from the economic hardships of the coronavirus; a side-effect of these hardships is a deep cut the tax revenues that pay for municipal workers.
The City of Pittsburgh estimates it will suffer a 21% cut in projected revenues in 2020, going from $608 million down to $481 million, for a total loss of $127 million. Over a five-year period from 2020-2024 the City expects to lose a total of $239 million, which amounts to a 7.5% cut.
These estimates are extremely fluid and will likely change depending on the length of business closures in the City. The tax revenues that are most in peril are payroll, parking, earned income and property taxes: these four taxes alone could see $97 million in losses just this year.
On the expense side, due to telework and staffing changes the entries into the City’s financial system have been delayed for weeks at a time. For that reason real-time financial forecasts are in flux, which is also making budget estimates challenging.
To do realistic five-year financial plans the City must perform financial outlooks that are responsible and unflinching. Pittsburgh government learned these hard lessons through 15 years in Act 47 oversight and must not return to budgeting through unrealistic financial gimmicks. To meet these challenges seriously and responsibly the City needs the federal government’s help right now.
Cities and states across the nation are facing the same budgetary uncertainties, yet our national recovery requires that such governments provide critical services. The City has joined with the U.S. Conference of Mayors in requesting the federal relief funds to protect its workers and keep delivering the essential government services needed to keep Pittsburgh and other cities safe.
“Despite years of sound fiscal management, the scale of this crisis has simply been overwhelming – it is only a matter of time before we will face cash flow issues affecting our ability to pay first responders and essential workers. We need relief and we need it now,” Mayor Peduto wrote.
A copy of the letter to President Trump is here.