Hazleton Moves To Save Money On Fire, Police Pensions

Downtown Hazleton, PA

Downtown Hazleton, PA (Photo credit: Wikipedia)

HAZLETON, PA — The city council approved use of a 75 percent amortization option to calculate its 2015 Minimum Municipal Obligation for the city’s non-uniformed, fire and police pension plans on Tuesday.

Don Williamson, ASCO Financial Services Group president, said although the city status as a distressed city has progressed from Level 3 to Level 2, it is still eligible to contribute to its MMO at a discounted rate for the years 2015 and 2016.

The move will save the city over $1 million dollars per year.

Councilman David Sosar inquired as to whether this would result in an increased financial burden to the city in upcoming years, to which Williamson replied, “I really don’t think so.”

Read more: http://www.timesleader.com/news/local-news/50460903/Hazleton-moves-to-save-money-on-fire-police-pensions

Scranton Wants To Declare Bankruptcy

Map of Pennsylvania highlighting Lackawanna County

Map of Pennsylvania highlighting Lackawanna County (Photo credit: Wikipedia)

SCRANTON, PA — When Detroit filed for bankruptcy, hundreds of residents took to the streets to protest what they saw as a drastic approach to fixing the city’s budget problems.

But in this hilly town of 76,000 in northeastern Pennsylvania, residents have a different view of Chapter 9: They want the city to declare bankruptcy. And soon.

“The silent majority would like to see bankruptcy,” said Bob “Ozzie” Quinn, president of the Scranton and Lackawanna County Taxpayers Association. “Basically, it’s down to a point where people cannot afford to pay the taxes and are moving out of town.”

Faced with a $20 million deficit, Scranton had to do some tricky maneuvering to balance its budget and avoid defaulting on loans. Most of this maneuvering has involved increasing taxes and fees paid by the people who still live in the town, which has seen its population drop by half since the 1930s.

Read more: http://www.timesherald.com/general-news/20140111/scranton-wants-to-declare-bankruptcy

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10 Years Later, Is Pittsburgh Really Climbing Out Of The Red?

A map of Pittsburgh, Pennsylvania with its nei...

A map of Pittsburgh, Pennsylvania with its neighborhoods labeled. For use primarily in the list of Pittsburgh neighborhoods. (Photo credit: Wikipedia)

Ten years and four months ago, then-Mayor Tom Murphy stood before a cadre of media to deliver grim news.

By the time he stepped up to speak, eyes moistened with tears, Pittsburgh city government had been sputtering along like an airplane held together by duct tape, according to a former finance director. But now the plane was about to take a nose dive — with the possibility of bankruptcy hovering.

“I hate doing this,” Mr. Murphy told the reporters.

He announced plans to lay off 731 city workers — including police officers — and leave hundreds more positions unfilled. All but six city pools would be drained and closed early — along with 19 recreation centers that were, in many places, critical gathering spots for sports and community events. Later that year, the city’s credit rating would be downgraded, making it the only major American city whose debt was rated “junk.” A fifth of the city’s budget went to pay off old debt.

Read more: http://www.post-gazette.com/local/city/2013/12/29/10-years-later-is-Pittsburgh-really-climbing-out-of-the-red/stories/201312290057#ixzz2or2K9BKS

Ruling Makes Detroit Biggest City To Qualify For Bankruptcy

English: Renaissance Center, GM World Headquar...

English: Renaissance Center, GM World Headquarters, Detroit, Michigan. (Photo credit: Wikipedia)

DETROIT — Detroit is eligible to shed billions in debt in the largest public bankruptcy ever in the United States, a federal judge ruled Tuesday, while also finding that the public pensions could be reduced during reorganization despite a provision in Michigan’s Constitution.

In ruling that Detroit was eligible to reorganize under federal bankruptcy law, Judge Steven W. Rhodes said the city met every test of insolvency, including failing to pay its debts and being unable to provide a minimum level of basic services to its 680,000 residents.

“This once proud and prosperous city can’t pay its debts,” the judge said. “It’s insolvent. It’s eligible for bankruptcy. But it also has an opportunity for a fresh start.”

Appeals were expected to be filed quickly. Bruce Babiarz, a spokesman for Detroit’s fire and police retirement system, which supports 8,500 retirees, said lawyers were reviewing the ruling and expected to file an appeal by the end of the week. But the case will continue to move forward, with the next step being the city filing a “plan of adjustment.” It is unclear, however, what portions of the judge’s ruling may be appealed.

Read more: http://www.nytimes.com/2013/12/04/us/detroit-bankruptcy-ruling.html?hp&_r=0

U.S. Steel’s Lower Taxes Causing Budget Headaches

U.S. Steel

U.S. Steel (Photo credit: Wikipedia)

A succession of successful tax appeals by U.S. Steel earlier this year, resulting in the assessed value of some of its major properties in Allegheny County plummeting by millions of dollars, has put big dents in municipal and school budgets.

The drop in real estate tax revenue has prompted three school districts — Woodland Hills, Clairton and West Mifflin — to file court challenges to the appeals granted to U.S. Steel by the Allegheny County Board of Property Assessment, Appeals and Review, and is pushing Braddock to consider an earned income tax increase.

Ira Weiss, solicitor for the Clairton City School District, called U.S. Steel’s new assessments, which resulted in the value of its coke plant in Clairton dropping from nearly $10.6 million in 2012 to just above $2 million this year, “laughable.”

“We believe the approach of [U.S. Steel] in these appeals with these communities where they’ve been longtime partners is deplorable, really,” Mr. Weiss said. “It was devastating. … [Clairton’s] a small school district in a small town and no local government can sustain this kind of hit from an ongoing concern.”

Read more: http://www.post-gazette.com/local/east/2013/11/30/U-S-Steel-s-lower-taxes-causing-budget-headaches/stories/201311300091#ixzz2m9CxWD00

Scranton Mayor Proposes 56 Percent Property Tax Increase; 69 Percent Garbage Fee Hike

Map of Pennsylvania highlighting Lackawanna County

Map of Pennsylvania highlighting Lackawanna County (Photo credit: Wikipedia)

With wary banks watching Scranton‘s finances closely, Mayor Chris Doherty today proposed a $130.5 million budget for 2014 that would dramatically raise real estate taxes, the garbage collection fee and parking-meter rates and penalties.

Read the budget HERE

A real estate tax increase of 56.7 percent would be one of the largest, if not the largest, tax hikes ever in the city. A trash collection fee increase of 68.5 percent – from the current $178 a year to $300 a year – would be the largest garbage fee hike ever.

The large spikes are all necessary to close a $20 million operating deficit for 2014 and restore the city’s creditworthiness with lenders, Mr. Doherty said.

Read more: http://thetimes-tribune.com/news/scranton-mayor-proposes-56-percent-property-tax-increase-69-percent-garbage-fee-hike-1.1586481

Act 47 Cities Elect New Mayors Amid Changes

Map of Pennsylvania, showing major cities and ...

Map of Pennsylvania, showing major cities and roads (Photo credit: Wikipedia)

HARRISBURG – New mayors have been elected in four large cities under Act 47 status just as lawmakers are giving greater attention to urban fiscal issues.

Election Day brought victories to Democrat Bill Courtright in Scranton, Democrat Bill Peduto in Pittsburgh, Democrat Eric Papenfuse in Harrisburg and Republican Matt Pacifico in Altoona.

The mayors-elect came to office by various routes and campaigned on issues specific to their cities, but once in office they will face common problems with a shrinking tax base, greater demand for municipal services and the skyrocketing cost of unfunded pension obligations for municipal employees.

It could help matters that new elected spokesmen for cities will be on the scene while state lawmakers consider a wave of legislation to help municipalities address financial problems.

Read more: http://citizensvoice.com/news/act-47-cities-elect-new-mayors-amid-changes-1.1582982

Courtright Wins, Mulligan Concedes Scranton Mayor’s Race

Map of Pennsylvania highlighting Lackawanna County

Map of Pennsylvania highlighting Lackawanna County (Photo credit: Wikipedia)

Republican Scranton mayor nominee Jim Mulligan has conceded defeat as Democratic city Tax Collector Bill Courtright won the right to run the city the next four years with a strong victory in the hotly fought contest.

“We’ve got to fix this city,” Mr. Courtright said from a stage in his downtown headquarters. “You know I’m humbled that the people of this city have once again voted for me and had the faith and trust in me and I’m thankful for that.”

With 41 of 48 city precincts reporting,  Mr. Courtright, a Democrat, had 7,646 votes, or 57.4 percent to Republican nominee Jim Mulligan’s 5,866 votes, or 43.1 percent. The rest are write-in votes.

Read more: http://thetimes-tribune.com/news/courtright-wins-mulligan-concedes-scranton-mayor-s-race-1.1580674

Harrisburg Strains To Eliminate Condemned Buildings; Residents Simmer Over Fire Hazards, Nuisances

HARRISBURG–In the 2000 block of Susquehanna Street, routine home maintenance included pruning a neglected tree to eliminate a ladder animals used to enter the upper floors of two condemned homes in the middle of the row.

It included dealing with encroaching mold from the condemned homes’ soggy beams.  It included adding boards at his own expense to keep out squatters, a neighbor said.

Harrisburg has about 400 vacant buildings whose status is considered “emergency” due to hazards and eyesore they pose or criminal activity they attract.  The city expects to demolish 35-40 this year — the most it can do given budget constraints and staffing shortages, said Robert Philbin, the chief operating officer.

“All I can tell you is the city is doing the best it can do,” he said.

Read more:  http://www.pennlive.com/midstate/index.ssf/2013/07/harrisburg_strains_to_eliminat.html#incart_m-rpt-2

Harrisburg To Get A Record $5 Million For Fire Protection For Capitol Complex

Harrisburg will receive full compensation from the state for providing fire protection and emergency services to the 40 tax-exempt state buildings located in the Capitol complex in the 2013-14 state budget making its way through the General Assembly.

Sen. Rob Teplitz, D-Dauphin County, applauded the funding that he along with state Rep. Patty Kim, D-Harrisburg, and Harrisburg’s city receiver Gen. William Lynch fought to get included in the $28.4 billion spending plan.

Despite that, Teplitz voted against the budget plan, which passed the Senate by a 33-17 vote. Democratic senators lambasted the plan for being too light on education and human service spending.

This amount going to Harrisburg exceeds the $2.5 million that Gov. Tom Corbett had proposed in his budget and what Teplitz called “the abysmal $496,000″ in the House-passed budget.

Read more:  http://www.pennlive.com/midstate/index.ssf/2013/06/harrisburg_to_get_a_historic_5.html#incart_maj-story-1

Will A New Face In The Mayor’s Office Improve Harrisburg’s Image?

Map of Pennsylvania highlighting Dauphin County

Map of Pennsylvania highlighting Dauphin County (Photo credit: Wikipedia)

Editor’s note: YES!  We would like to see Eric Papenfuse win the November election.  It’s time to restore someone with business acumen to the office of the mayor in Harrisburg.  Eric is an excellent businessman and has been a leader in helping to revitalize Midtown Harrisburg.  Eric’s bookstore, Midtown Scholar, is one of the anchors of the new Midtown.

When major financial news organizations send reporters to a city the size of Harrisburg to cover the election for mayor, it usually means things haven’t been going well.

That was evidenced Tuesday night, as a Reuters news dispatch described Mayor Linda Thompson‘s defeat in the Democratic primary. The story began, “The embattled mayor of Pennsylvania’s financially crippled capital of Harrisburg was ousted on Tuesday…”

Embattled.  Financially crippled.  Harrisburg.

No matter who wins in November, the city’s next mayor must repair Harrisburg’s badly damaged brand, and that could be one of the most formidable aspects of the job.

Read more:  http://www.pennlive.com/midstate/index.ssf/2013/05/harrisburg_mayor_thompson_pape.html#incart_m-rpt-2

COPS Funds Pose Quandary For Reading Police Department

A big new batch of federal grant money is available to police departments that want to hire more officers, but the strings attached to it make it uncertain whether Reading will apply.
Reading Police Chief William M. Heim said the city is eligible to apply for Community Oriented Policing Services (COPS) funds from the U.S. Department of Justice for the first time since 2009, when it received $1 million.

A review of grant program rules posted online indicates the city might be able to apply for partial funding of as many as eight police officer positions. Heim said he will be looking at the rules in the coming week.

Law enforcement funding was a big issue at the Berks-Reading crime summit in January, and the COPS application deadline is May 22.

Read more:  http://readingeagle.com/article.aspx?id=473304

State Puts Reading School District On ‘Financial Watch’

Map of Berks County, Pennsylvania, United Stat...

Map of Berks County, Pennsylvania, United States Public School Districts (Photo credit: Wikipedia)

The state has officially labeled the Reading School District as being in “financial watch status,” a step away from state intervention.

The Department of Education announced Friday that the district has hit several financial-difficulty indicators in the Act 141 early warning system. Passed last year, Act 141 is the state’s law to help financially distressed school districts.

Four districts – Harrisburg, Duquesne, Chester-Upland and York – already have been placed in Act 141 financial recovery and have state-appointed recovery officers overseeing their finances, something Reading officials are hoping to avoid.

Dr. Carlinda Purcell, superintendent, said she sees the designation as a positive step toward dealing with the chronic financial struggles.

Read more: http://readingeagle.com/article.aspx?id=460369

Michigan To Appoint Emergency Fiscal Manager For Detroit

English: City seal of Detroit, Michigan.

English: City seal of Detroit, Michigan. (Photo credit: Wikipedia)

DETROIT — Gov. Rick Snyder of Michigan announced on Friday that the city of Detroit is so snarled in financial woes that the state must appoint an emergency manager to lead it out of disaster.

“There is probably no city that is more financially challenged in the entire United States.  If you look at the quality of services for citizens it’s ranked among the worst.  So we went from the top to the bottom over the last 50 or 60 years,” Mr. Snyder told Detroiters in a town-hall-style meeting that was broadcast live on local television stations across the city.

“It’s time to say we should stop going downhill,” he said.  “There have been many good people that have had many plans, many attempts to turn this around, they haven’t worked.  The way I view it, today is a day to call all hands on deck.”

The state-appointed manager, who could be selected later this month, would ultimately wield powers aimed at swiftly turning around the municipal government’s dire circumstances — powers to cut city spending, change contracts with labor unions, merge or eliminate city departments, urge the sale of city assets and even, if all else failed, to recommend bankruptcy proceedings.

Read more:  http://www.nytimes.com/2013/03/02/us/michigan-appoints-emergency-manager-for-detroit.html?hp&_r=0

Scranton’s Parking-Garage Rates Won’t Decrease; Chamber Seeks Parking Input

As Scranton leaders are considering increasing hours, days and rates of downtown parking meters, some business owners want to see the city’s parking-garage rates reduced.

However, the court-appointed receiver in charge of the garages and their rates, Mike Washo, said he has no plans to lower garage rates, because a reduction would drain revenue from the authority and further burden city taxpayers to fund any shortfall that may arise from reduced rates.

“We don’t believe that any reduction in parking garage rates at this time will generate additional customers to justify the reduction in rates,” Mr. Washo said. “At the end of the day, we’ll end up with less revenue.”

In recent weeks, a plan by Scranton’s mayor and city council to hire a private firm, Standard Parking, to manage the city’s on-street parking meters has raised numerous questions and concerns among downtown businesses, residents and council members.  Citing Standard Parking’s estimates, council members think the city can net an additional $1.8 million a year by switching parking-meter management from the inactive Scranton Parking Authority to Standard Parking.  Under this plan, which was tabled Feb. 7 by council, meter hours would extend from 8 a.m. to 6 p.m. Monday through Friday to 8 a.m. to 8 p.m. Monday through Saturday.  Ten-hour meters also would increase from $1 an hour to $1.50 an hour.

Read more:  http://thetimes-tribune.com/news/scranton-s-parking-garage-rates-won-t-decrease-chamber-seeks-parking-input-1.1444474

Courtright Announces Candidacy For Scranton Mayor

The hundreds of supporters entering the front door at the Keyser Valley Community Center on Sunday to see Democrat Bill Courtright formally announce his campaign for mayor of Scranton received smiles and handshakes from the candidate himself.

Bruce Springsteen’s “Glory Days” played in the background as Mr. Courtright focused on themes of “returning the luster” and reaching out to the people of his hometown – a place of staggering municipal debt and significant skepticism about city leadership.

The city’s current tax collector and a former city councilman, Mr. Courtright, 55, of 126 Ridgeview Drive, said he will bring commitment, competence and character to City Hall.

Without going into a lot of detail, he also offered insights into his immediate priorities if elected mayor, calling for an in-depth analysis of the city’s finances and plans to create a panel of community leaders to help solve the city’s problems.

Read more:  http://thetimes-tribune.com/news/courtright-announces-candidacy-for-scranton-mayor-1.1435709

Reading Weighs Accepting Grant For More Firefighters

A 1947 topographic map of the Reading, Pennsyl...

A 1947 topographic map of the Reading, Pennsylvania area. (Photo credit: Wikipedia)

Editor’s note:  We can’t predict the future. Take the money, hire the people and hope for the best!

Spending a $4 million federal grant to the city is not as easy as it seems.

The problem is not what the grant would do – hire 30 new and badly needed firefighters for the next two years, adding more personnel to each truck – but what happens to those firefighters when the grant expires.

Fire Chief David Hollinger and City Council labored over the issues Monday night.

On the positive side, the grant does not require the city to keep the grant-paid firefighters after the grant runs out in March 2015.

Read more:  http://readingeagle.com/article.aspx?id=443754

Chris Kelly: How Can Scranton Find A Talented Mayor For $50G?

picture-0571Editor’s note:  And sometimes people are grossly overpaid and get lousy results, but we won’t name any names.  And sometimes you do a national search for qualified candidates (that was funded by tax dollars), offer a huge salary to attract the cream of the crop and then STILL give the job to your best pal with almost no hands-on experience.

HELP WANTED: CEO for financially distressed 146-year-old limited partnership drowning in long-term debt and enough past-due bills to choke a goat.  Successful applicant will be responsible for managing the needs, wants, safety and endless complaints of 74,000 customers while juggling chronic deficits, anemic revenues, suffocating union contracts and crippling legacy costs using a business model that hasn’t evolved since the advent of indoor plumbing.  ANNUAL SALARY: $50,000.  Seriously.  That is not a typo.

Mayor Chris Doherty’s recent announcement that he will not seek a fourth term as the CEO of Scranton was as anticlimactic as the average January sunset – bleak blue beams bleeding into blackness.  Anyone with a calendar saw it coming.

Eleven years into Mr. Doherty’s reign, the Electric City remains powered more by wishful thinking than objective reality.  More than 20 years after it blundered into the roach motel that is the state’s Act 47 Distressed Cities Recovery program, Scranton is still stuck.  Mr. Doherty promised escape from distressed status by the end of his first term.  He failed, but he had a lot of help.

Read more:   http://thetimes-tribune.com/opinion/editorials-columns/christopher-j-kelly/chris-kelly-how-can-scranton-find-a-talented-mayor-for-50g-1.1428801

PEL: Scranton Needs More Than 12% Tax Hike

Map of Pennsylvania highlighting Lackawanna County

Map of Pennsylvania highlighting Lackawanna County (Photo credit: Wikipedia)

Scranton‘s state-designated recovery coordinator, Pennsylvania Economy League, has told city officials they need to raise property taxes next year higher than the 12 percent that the city budget for 2013 proposes. Exactly how much higher was not stated.

In a letter received Thursday, PEL Executive Director Gerald Cross notes that the city has not dedicated a tax millage toward paying for the city’s second unfunded debt package approved by a court this year, of $9.75 million. In that case, Judge Peter O’Brien, a senior visiting judge from Monroe County, on Oct. 31 ordered that a tax millage be dedicated to paying back this unfunded debt.

It was the same arrangement the city sought and received in January, when a different judge, Senior Monroe County Judge Jerome Cheslock, approved the city’s first unfunded debt, of $9.85 million, and ordered that this amount be paid back with a dedicated tax millage over 10 years.

The first unfunded debt package translated into the 12 percent tax hike in the proposed budget for next year, city officials have said.

Read more:  http://thetimes-tribune.com/news/pel-scranton-needs-more-than-12-tax-hike-1.1413187

Reading City Council Approves Budget, Tax Hikes

Editor’s note:  For those folks in Pottstown, please note that Reading is 4 times as large as Pottstown, yet their budget is only twice as big.

City Council on Monday adopted a $77 million budget for 2013, as well as the increases in property, local earned income and commuter taxes needed to make it work.

• The property tax will rise by 9.45 percent, or 1.355 mills, to a total of 15.689 mills.  An owner with a property assessed at $50,000 will pay an extra $67.75.

• The local earned income tax on city residents will rise by 0.2 percentage points to 3.6 percent.  That rate includes the Reading School District‘s share.

• And the commuter tax will rise by the same 0.2 points, to 0.3 percent.

Read more:  http://readingeagle.com/article.aspx?id=431486