Scranton Mayor: City Solid, Getting Stronger

In his first “State of the City” address since taking office 16 months ago, Scranton Mayor Bill Courtright delivered a hopeful, optimistic speech Friday at the Greater Scranton Chamber of Commerce.

Describing the state of the city as “solid and getting stronger every day,” Mr. Courtright said initiatives he, his administration and council are pursuing have the city turning the corner on decades of financial distress, mistakes and “embarrassments” of the past.

“In just over a year, we’ve been able to tell a different story about Scranton. A story of hope and optimism, backed up by real progress,” Mr. Courtright said.

For example, plans to unload the Scranton Parking Authority’s high-debt and under-used garages are advancing and going better than expected, he said, as the city met this week with six firms interested in acquiring them. The goal is to complete a transaction by the end of the year. Another goal is “responsible monetization” of the Scranton Sewer Authority through a sale or lease that this agency is pursuing.

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Scranton City Council OKs Revised Recovery Plan

Scranton City Council on Thursday passed the first of three votes needed to adopt a revised Act 47 recovery plan.

Council voted 4-0, with President Bob McGoff and Councilmen Joe Wechsler, Wayne Evans and Bill Gaughan all in favor, to introduce an ordinance to adopt the recovery plan crafted by the city’s Act 47 recovery coordinator, Pennsylvania Economy League.

Councilman Pat Rogan was absent.

Before the meeting, council held a caucus with PEL officials Gerald Cross and Joseph Boyle, city Business Administrator David Bulzoni, and Jim Rose of the state Department of Community and Economic Development, which oversees PEL.

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Scranton Councilman Worries New Union Contract Ties Hands In Exiting Act 47

Scranton could have a difficult time shedding its distressed city status because of the pay raises and other perks in the revised police contract, a city councilman warned.

The city has until 2020 to successfully exit the state’s Act 47 financially distressed municipalities program. The new seven-year police contract approved by a split city council Thursday and signed by Mayor Bill Courtright Friday will hinder the city because the contract locks in pay raises and benefits beyond 2020, said Councilman Bill Gaughan.

He questioned whether the contract extension would “tie the city’s hands” by eliminating the possibility of negotiating in 2017 savings in a new police contract, while at the same time locking in raises and benefits a year beyond the Act 47 deadline of 2020.

Mr. Courtright disagreed that the contract extension will make it more difficult for the city to successfully exit Act 47.

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Authorities: Heroin Problem In Region Will Only Get Worse

Map of Pennsylvania highlighting Luzerne County

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

WILKES-BARRE, PA — Heroin is affecting the region at epidemic levels and the problem is only expected to get worse, law enforcement officials told the Pennsylvania Economy League at a meeting Friday afternoon.

The drug is selling on the cheap, and addicts — many of whom got started by legitimately using prescription painkillers — are bringing a plague of crime to the area, West Hazleton Police Chief Brian Buglio said. Almost all robberies, thefts and assaults in the Hazleton area have a drug or gang nexus, he said.

“Heroin is terrifying, and it’s only going to get worse, unfortunately,” Buglio said during the meeting at Best Western Genetti Hotel and Conference Center.

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West Hazleton No Longer In ‘Distressed Municipality’ Status

Map of Pennsylvania highlighting Luzerne County

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

WEST HAZLETON — The state has rescinded the borough’s status as a distressed municipality. But while the borough has significantly improved finances since 2003, it’s not out of the woods yet.

State Department of Community and Economic Development Secretary C. Alan Walker determined that West Hazleton’s distressed status would be rescinded after a review of audits and financial data and the record from a public hearing on June 3, Gov. Tom Corbett’s office announced Thursday in a news release.

The hearing officer’s report revealed that in 2013, the borough had a $5,423 budget surplus, that finances were stable, and that the borough has the tools to make the decisions necessary to maintain responsible budgets, meet its obligations to vendors and creditors, and provide essential services to residents.

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Local Services Tax Could Triple Under Act 47 Plan

HARRISBURG — People who work in Scranton and other distressed municipalities could see a $52 annual tax triple under a new Senate amendment.

Lawmakers want to steer Act 47 municipalities to levy a higher local services tax as an alternative to a commuter tax.

The distressed cities legislation cleared a first Senate hurdle Wednesday with a comprehensive amendment added by the Local Government Committee.

The committee’s action is the latest step in an effort to overhaul the Act 47 program for fiscally distressed municipalities. Scranton, Nanticoke, West Hazleton and Plymouth Twp. have Act 47 status. Shamokin is seeking to enter the program.

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Scranton Mayor Vetoes Council’s Revisions To His Budget

Map of Pennsylvania highlighting Lackawanna County

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

Mayor Chris Doherty on Friday vetoed city council’s revisions to his proposed $130.2 million budget.

Council will hold a special meeting Monday at 5:30 p.m. to vote on whether to override or sustain the veto, council President Janet Evans said.

A split council on Thursday raised and lowered some salaries and added two positions in the mayor’s budget. The amendments did not change the budget total or the 57 percent tax increase and 69 percent trash collection fee hike.

Council voted 3-2 on many of the amendments in a split that had Councilmen Bob McGoff, Pat Rogan and Jack Loscombe, who are all returning to council in 2014, forming a bloc to pass the amendments, and Council President Janet Evans and Councilman Frank Joyce, who are departing council, dissenting.

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PEL: Scranton Faces $20 Million Deficit Next Year; Needs To Raise Taxes

Map of Pennsylvania highlighting Lackawanna County

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

Scranton city government’s budget outlook for next year continues to worsen as the city now faces a possible deficit of nearly $20 million for 2014, according to the city’s financial-recovery coordinator.

That state-appointed Act 47 coordinator, Pennsylvania Economy League, also urges the city to craft a “realistic and responsible” budget for next year that closes the structural deficit and lists as options unspecified hikes in both the real-estate (property) and earned-income (wage) taxes, and an increase in the city’s annual garbage fee.

“I think the letter speaks for itself,” Mr. Cross said in a phone interview. “It shows where the city is in terms of recovery-plan progress and shows the challenges that we always spoke of for 2014 being a challenging year.”

Read the letter here

City Business Administrator Gina McAndrew said the 2014 budget is in the works. She would not rule out any increases in taxes or fees but declined to say what may be under consideration.

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Legislators: Montco, SE Pa. Need More Transportation Funding

SEPTA logo with text

SEPTA logo with text (Photo credit: Wikipedia)

Editor’s note:  This is obvious.  Just try and drive to work in Montgomery County. Traffic is horrendous!

WHITEMARSH ­­— The House Democratic Policy Committee held a two-hour Wednesday morning at the township building to draw attention to the need to increase transportation funding in the region.

The general consensus among the experts offering testimony was that Pennsylvania, and Southeastern Pennsylvania in particular, needs more state funding for mass transit, road and bridge repairs.

State Rep. Mary Jo Daley, D-148th Dist., said Whitemarsh is a center of transportation with major roadways including Germantown Pike and Ridge Pike and six train stations on the regional rail lines.  Daley moderated the hearing.

“I have been a SEPTA rider my entire life,” Daley said. “I’m not sure what it would be like to not have public transportation.  It is a really flexible system that benefits the area.”

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School Merger A Hard Sell At Exeter Forum

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

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

Exeter School District residents made it clear Tuesday night that a full merger with the Antietam School District would be a hard sell to them.

“It seems as if it’s a white knight issue, with Exeter rescuing a school district that’s looking at this as a win-win opportunity,” resident Kim Farinelli told the Exeter School Board and more than 150 attendees who packed the cafeteria at the Reiffton School.

“I don’t see why there’s any reason to have this discussion,” resident Nikki Smith added. “It seems all negative for us and all positive for Antietam.”

The two were among many who took to the podium to voice their opinions at the Exeter community forum, which focused on the findings of a feasibility study on a possible merger between the two districts.

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Spencer Unveils Bold Plan For Reading

English: Downtown Reading, Pennsylvania; with ...

English: Downtown Reading, Pennsylvania; with Berks County courthouse on left; July 2007 (Photo credit: Wikipedia)

Reading Mayor Vaughn D. Spencer on Thursday outlined an ambitious agenda of more than a dozen initiatives, some already begun, to improve the finances and conditions of the city and its neighborhoods.

Speaking to several dozen people attending the Pennsylvania Economy League’s Issues Forum at the Berkshire Country Club in Bern Township, Spencer recounted his campaign themes and said: “Those are the promises; what people expect is performance.”

He then led the audience through a rapid-fire explanation of where the city is and where it’s planning to go in several key areas.

He said the city has set goals for each area and is requiring any department initiatives to match those goals, with their results to be measured.

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Judges Reject Scranton Commuter Tax

A panel of three judges Wednesday rejected Scranton‘s petition for a 1 percent wage tax on the nearly 23,000 nonresidents who work in the city but live elsewhere.

The city may make up the resulting budget shortfall next year by borrowing more next year than had been anticipated or selling an unspecified city asset, Mayor Chris Doherty said.

In their 50-page ruling, Lackawanna County Judges Terrence Nealon and Robert Mazzoni and visiting Pike County Judge Harold Thomson stated the city failed to prove its case for a 1 percent earned income tax on the 22,655 nonresidents working in the city.

The city failed to pass a required hurdle of having “substantially implemented” a revised recovery plan, by failing to fulfill two revenue generators in that plan.  Those included failing to obtain a commitment from a lender for a lease-back borrowing measure to be undertaken next year; and failing to obtain commitments from nonprofit entities for significantly increased donations, according to the ruling.

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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.

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Mount Penn Formally Ends Merger Talks With Lower Alsace

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

Map of Berks County, Pennsylvania, United States with township and municipal boundaries (Photo credit: Wikipedia)

Lower Alsace Supervisor John Theodossiou made one final plea asking Mount Penn Borough Council to reopen merger talks between the two municipalities.

“I understand there are a lot of differences and things got derailed,” he said. “At the very least go to the next meeting.”

But Theodossiou’s effort landed with a thud, as Mount Penn council voted on Tuesday to send letters to the Pennsylvania Economy League and Berks County formally ending the merger study.

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City Of Reading: A Study In Contrasts

Map of Pennsylvania highlighting Berks County

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

The Reading Redevelopment Authority on Wednesday unveiled a thick sheaf of brightly colored graphics and numerous data tables that all point to one map in the middle – a map the authority and the city say will guide future city economic development efforts.

That map shows where the high-value housing markets are in the Reading area and the location of steady markets, transitional neighborhoods and distressed areas, all in specific detail.

It’s part of the market value analysis that The Reinvestment Fund, Philadelphia, completed for the authority and released at a Pennsylvania Economy League breakfast at the Berkshire Country Club, Bern Township.

“What the MVA (market value analysis) basically does is help you focus your meager resources and channel your efforts on nodes of strength,” said Adam Mukerji, authority executive director.

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SAPA Plan Included In Scranton’s Updated Recovery Plan

More than two years after Scranton City Council slammed the door on a regional planning initiative, the Pennsylvania Economy League has pushed it wide open.

Tucked inside Scranton’s 60-page updated 2012 Recovery Plan, which council accepted Thursday, is one paragraph suggesting council will reconsider joining the Scranton-Abingtons Planning Association Comprehensive Plan.

“The PEL sneaked it in the recovery plan at the 11th hour, right before our final vote,” Councilman Jack Loscombe said. “I still feel the same way, though. I don’t see how the plan benefits the city economically.”

The plan, which has been adopted by nine municipalities, provides a policy guide for future land use, economic revitalization, open space conservation and historic resource preservation among the SAPA members. Scranton is the last SAPA member, of 11, to consider adopting the comprehensive plan, according to the updated recovery plan.

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Scranton Gets $6.2M Short-Term Loan; State Sets Public Hearing On Plan For Today

Editor’s note:  We are pleased to see that the mayor and council president have put aside their differences and are working together.  It’s making a difference!

Like dominoes falling, Scranton has finally adopted a revised recovery plan, and because of that the city now will receive a $2.2 million state aid package and a $6.25 million short-term bank loan that will allow the city to pay bills and payrolls while continuing to seek long-term borrowing to fund its 2012 budget.

The flurry of separate, yet related, developments has bought the city some time to resolve its short-term financial crisis, however the city still needs to secure other borrowing to end the year in black, Mayor Chris Doherty and council President Janet Evans said.

The stage was set with the city’s proposed revised recovery plan having received approval in recent days from its Act 47 recovery coordinator, Pennsylvania Economy League.  That approval will allow the city to receive the $2.2 million state aid package from PEL’s overseer, the state Department of Community and Economic Development.  With PEL and DCED on board with the city’s recovery plan and the state aid package on the way, the city was able to secure on Wednesday night a $6.25 million tax- anticipation note from Amalgamated Bank of New York and Washington, D.C., the mayor and Mrs. Evans announced late Thursday afternoon in front of City Hall, shortly before the council meeting.

“This buys us time,” Mr. Doherty said of the bank loan and state aid package.  “With the recovery plan being passed, it sends a positive message for our future borrowing.”

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Scranton City Council Holds Hearing On Recovery Plan

In a first in several years, Scranton Mayor Chris Doherty on Thursday attended a city council meeting that was a public hearing on their joint revised recovery plan.

The mayor – who usually bears the brunt of a barrage of negative comments and criticism from council and some regular attendees at weekly council meetings – had not attended a council session in about six years, council President Janet Evans said.

However, the city’s financial crisis has finally made for some strange bedfellows between the mayor and council majority, who usually are mortal political enemies. After months of a bitter mayor/council stalemate over revising the city’s Act 47 recovery plan that would be acceptable to banks and the city’s recovery coordinator, Pennsylvania Economy League, the mayor and Mrs. Evans reached an accord July 27. As a result, she said she asked the mayor to attend the hearing, and he agreed.

“It was a milestone,” Mrs. Evans said of the mayor’s appearance. “We’re very pleased to be working with him.”

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Scranton City Council Sets Public Hearing On Recovery Plan

English: Downtown , USA

English: Downtown , USA (Photo credit: Wikipedia)

Scranton City Council on Thursday tabled a revised recovery plan but set a public hearing on the proposal for next week and a vote for adoption for the following week.

Council President Janet Evans said efforts are under way to further revise the consensus recovery plan.  It was reached July 27 by her and Mayor Chris Doherty after months of stalemate, but raised concerns from the city’s Act 47 recovery coordinator, Pennsylvania Economy League, that much of its revenue was speculative.

“There are adjustments being made to it, and it’s ongoing,” Mrs. Evans said.  “I’m hoping that all changes are complete prior to the public hearing.”

At the Aug. 2 meeting, Mrs. Evans said the mayor/council consensus plan was a “take it-or-leave it” proposition for PEL.  Asked after the meeting if she had backed away from that stance, Mrs. Evans said no.

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Blue Cross Sues Scranton After City Defaults On $2 Million Note

Blue Cross of Northeastern Pennsylvania filed a lawsuit Wednesday against Scranton seeking $2.05 million owed by the city in a promissory note from last fall.

The city executed a note on Oct. 27 promising to pay Blue Cross $2 million in unpaid bills by Jan. 5, the lawsuit states. But the city failed to pay and that constituted a default, the lawsuit states.

As of Wednesday, no payment had yet been made and the lawsuit seeks the principal amount of $2 million as well as 5 percent interest that accrued to $58,904 from Jan. 6 to Wednesday, for a total amount sought of $2,058,904, according to the complaint.

Blue Cross has been one of the city’s largest vendors with bills that have gone unpaid under the city’s financial crisis. As such, the lawsuit was not necessarily unexpected, said Mayor Chris Doherty, adding that he is in contact regularly with Blue Cross about the situation and the firm is continuing to provide health care coverage for the city’s employees.

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