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Pittsburgh Emerges from Distressed Status Under Act 47
HARRISBURG, Pa. – Yesterday, Governor Tom Wolf announced that the city of Pittsburgh’s status as a distressed municipality under Act 47 is terminated. Pittsburgh is the second city and 14th municipality to exit the program.
(Photo courtesy City of Pittsburgh – Office of the Mayor.)
“This turnaround wasn’t easy – it took a lot of hard work, a lot of collaboration, and yes, some constructive arguments about where the city was headed, but in the face of it all, Pittsburgh stood united – desperately working to improve its stability and its financial health,” said Governor Wolf. “Pittsburgh’s recovery has captured the attention of the nation, and, frankly, the world. We’ve transformed a rust belt city that was a symbol of economic decline into one of the most dynamic examples of innovation for the new economy in the world. My administration has been proud to support your efforts and will continue to do so in the years ahead.”
In a ceremony at the City-County Building, Governor Wolf joined Pittsburgh Mayor William Peduto, city officials, local legislators, economic development officials, and Department of Community and Economic Development (DCED) Secretary Davin, who issued a formal determination letter finding that termination of the city’s distressed status was appropriate under Section 255.1 of Act 47. Secretary Davin made the decision after a thorough review of the city’s audits, financial data, and the record from a public hearing held on December 20, 2017.
“I want to thank Governor Wolf and DCED for this announcement, and especially city residents and workers for all their patience and sacrifices the past 14 years,” Mayor Peduto said. “Act 47 was the tool we needed to bring our financial house in order and pave the way for Pittsburgh’s economic resurgence. Now our challenge is to continue building upon the fiscal discipline it taught us.”
Pittsburgh has operated under Act 47 status for 14 years, entering on December 29, 2003. In the last few weeks, Secretary Davin reviewed documentation and evidence that was presented during the December 20 public hearing. The findings indicated that – bolstered by careful budget governance and a recent surge in the city’s technology and medical sectors – the city has stabilized its finances, and now operates with healthy surpluses that are projected to continue. It also reported the city’s debt service is reasonable and manageable when compared with the overall budget, and that city administrators have developed a strategy for fiscal management that pays for the necessary city services such public safety and public works, funds employee pensions plans, invests in capital improvements, and controls costs.
“When Governor Wolf appointed me to this position, he set forth several priorities for my agency, one of which was to make sure Pittsburgh had the necessary support from Harrisburg to exit Act 47,” Secretary Davin said. “I’m extremely proud of our team and everyone here in the city who worked with energy, focus, and determination to get us to this point today.”
Since 2015, five municipalities, including Pittsburgh, have recovered from distressed status. Others include Altoona, Blair County, Plymouth, Luzerne County; Nanticoke, Luzerne County; and Clairton, Allegheny County.
The Municipalities Financial Recovery Act, Act 47 of 1987, was enacted to provide a broad-based program of fiscal management oversight, technical assistance, planning and financial aid to municipalities experiencing severe fiscal distress.
For more information on Act 47, visit the Governor’s Center for Local Government Services at the Department of Community and Economic Development.
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