Title
Resolution Petitioning the Pennsylvania Secretary of the Department of community and Economic Development, pursuant to Act 47, Section 253 Termination of Status , subsection (b) Determination upon petition by a municipality , to make a determination that the condition which led to the designation as a distressed municipality are no longer present.
Body
WHEREAS, on November 7, 2003, the City filed an application to be declared a distressed municipality pursuant to the authority of Act 47;
WHEREAS, in 2003 the Secretary of the Department of Community and Economic Development (the Secretary), at the request of the Mayor of the City of Pittsburgh, conducted a review of the city's financial position and made a determination of financial distress; and,
WHEREAS, on December 29, 2003, the Secretary declared the City to be a distressed municipality pursuant to the terms of Act 47; and,
WHEREAS, the Secretary of the DCED appointed a coordinator (the "Act 47 Coordinator") who, in due course, prepared a financial recovery plan (the "Act 47 Plan") which was duly adopted by the governing body of the city by Ordinance enacted June 29, 2004 and approved by the Mayor on June 30, 2004 (Ordinance No. 10 of 2004);
WHEREAS, the government of the City of Pittsburgh vigorously and diligently, implemented the terms of the recovery plan despite the fact that the revenue recommendations of both the Act 47 Coordinator and the Intergovernmental Cooperation Authority, created by Act 11 of 2004, made to the state legislature were not fully implemented; and,
WHEREAS, despite the fact the city received less than expected revenues reflected in the Recovery Plan, the continued deferral of gaming revenues, and reduction of certain tax rates, the City of Pittsburgh's government was, among other things, able to reduce the workforce by 27% from 2002 to 2006, reduced the operating budget by Thirty Seven Million dollars ($37 Million), reduced health benefit costs by Seventeen Million dollars ($17 Million), entered into shared services agreements with the governments of Allegheny County and the Borough of Wilkinsburg (with more such agreements anticipated), obtained significant wage and benefit concessions from bargaining units representing various city employees, initiated a four year wage freeze for non-represented employees, significantly increased employee health care contributions, provided three successive positive operating fund balances, raised its bond rating, reduced debt service, and provided a cash reserve projected to be close to One Hundred Million dollars ($100 Million) at the end of 2007 fiscal year; and,
WHEREAS, the governing body of the City of Pittsburgh believes that we have met or exceeded the requirements of the recovery plan and have met the requirements enumerated in Act 47 for the Secretary's consideration for termination of the city's distressed status pursuant to the criteria enumerated at Section 253(c) of Act 47.
Be it resolved that the Council of the City of Pittsburgh hereby enacts as follows:
Section 1. Pursuant to the terms of Act 47, the Council does hereby petition the Secretary of the Pennsylvania Department of Economic and Community Affairs to make a determination as to whether or not the City of Pittsburgh should be considered a distressed municipality.
According to the criteria set forth in Act 47, the Secretary is to make that determination based upon the conditions which led to the earlier determination of municipal financial distress are no longer present. Additionally, the Secretary is to: conduct a review of the financial reports submitted by the Coordinator and:
Insure that any accrued deficits and any indebtedness incurred due to retire any deficits were eliminated (the city incurred no deficits or related debt); and,
That the municipality has operated at least one year under a positive fund balance or equity evidenced by audited financial statements (the city has done so for 3 years and expects the 2007 audited financial statements to reflect a positive net operating result of Eighteen Million dollars ($18 Million).
In the event that the Secretary should make a determination that the city is not eligible for removal of distressed municipality status, the Council of the City of Pittsburgh respectfully requests that the Secretary provide to the government of the city clear and definable benchmarks as to what would be further required to have the status of distressed municipality removed.
We, the Council of the City of Pittsburgh, pray that the Secretary appreciates our desire to have a complete, detailed understanding of what those further requirements might be so that we may take the appropriate actions to cause the city to meet or exceed any and all requirements imposed by the Commonwealth. As we take up our work on the 2008 budget to meet the needs of the people of Pittsburgh it is imperative that we be provided this information in order to make clear, cogent decisions regarding the city's operating budget and set the stage for the city's continued progress on the restoration of the fiscal integrity of its government.
Furthermore, the City of Pittsburgh is well aware of the negative repercussions of distressed municipality status and fully appreciates how that designation limits our ability to realize the potential of what the City of Pittsburgh has to offer to its residents, the ability to develop a strong regional economy, and contribute to the overall good of this Commonwealth.