Last night, at a meeting with County Council, the Chief Executive said "I will do everything in my power to make sure [a 2012 reassessment for Allegheny County] does not happen". 

That's quite different from what he said in an official County press release dated December 4, 2009: "Allegheny County will comply with the court-ordered 2012 reassessment..."

So what accounts for the shift in thinking?  It is anyone's guess at this point.  Perhaps more important is exactly how the Executive plans to stop the reassessment from going forward.  A bill he favored that would allow for a moratorium on reassessments continues to languish in the General Assembly, and for good reason-that bill would create a Constitutional crisis by having one branch of government telling counties to ignore a unanimous Supreme Court decision. 

Maybe he wants to study the issue to death, and this is another idea that ought to be nipped in the bud.  The Court of Common Pleas provided a comprehensive picture of assessment practices, as did the Allegheny Institute, and the Supreme Court decision even noted that "twenty two of our sister states require annual reassessments, while twenty six permit reassessments to be conducted at intervals over one year, though they still require periodic reassessment".  If the Executive is trying to find another state that allows for indefinite base year assessments, he is not going to find evidence to bolster his case.

What is the Executive's plan for reassessments then?  To keep the courts out of assessments completely, even if questions over uniformity arise?  A zero windfall in order to prevent the "back door" tax increases that he abhors?  A shift to income or sales taxes in order to end property taxes for schools, cities, and counties?  How would he treat counties where a reassessment occurs by an affirmative vote of elected county officials as opposed to a court ordered reassessment? 

So many questions arise from this never ending quest to prevent what the highest court in the Commonwealth said needs to be done. 

Pittsburgh City Councilman Ricky Burgess wants to resurrect the City's dormant living wage law.  His action follows quickly on the heels of prevailing wage legislation being reintroduced after being vetoed by the Mayor.  The Councilman's rationale is that if the prevailing wage for workers on City subsidized projects is justice, then "why not justice for everyone?"

The City's living wage bill was made dormant by a provision that the County would need to enact a similar law.  Since the County has not done so, coming to its senses back in 2001 when it came up for a vote, the City version never took effect.  

So why not do justice for everyone?  Well for starters that City cannot afford it.  Keep in mind that this is the same City that is buckling under the weight of its legacy costs and has been under state-controlled financial oversight since 2005 with no end in sight.  To keep its head above water the City recently went after the university community by threatening to levy a tuition tax on all college students within its borders.  While this attempt was unsuccessful, it underscores just how precarious City finances are. 

The living wage ordinance doesn't cover just firms receiving City subsidies.  It covers firms contracting with the City and City workers themselves.  Imposing the living wage law will only put more strain on finances.  Firms with contracts will adjust their bid to cover the increased wage costs and the City's personnel costs and contracted services will increase. 

Of course the taxpayers will end up paying for this version of "justice"-something they can do without.

Prevailing wage legislation continues to be a hot topic in Pittsburgh.  Since the Mayor vetoed Council's passed bill on December 31^st, both he and Council have introduced competing versions of the prevailing wage ordinance.  The Mayor, buckling under pressure from union leaders, will introduce a bill that appears to be more business friendly and makes its effective date contingent on Allegheny County passing similar legislation.  The Mayor must have figured County's passage was a long shot-but he appears to be wrong. 

County Council is working on introducing their own version which would cover any food and building service workers employed at any County building or County-subsidized project.  Their wages will be determined not by the market, but by local averages for similar positions or set by the Pennsylvania Department of Labor.  This would also include any benefits and leave time. 

At a time when the nation and region are struggling to emerge from the recession, neither the City nor County needs to be interfering in the market place.  Obviously they haven't learned from their past meddling.  The high taxes imposed on businesses in the City and County begat subsidies to retain current or attract new ones.  This strategy failed miserably as area job growth was sluggish at best while most of the rest of the nation prospered. 

Now officials are upset that businesses who took the subsidies are not paying what they, and their union collaborators, deem to be sufficient wages.  So naturally they propose to mandate wages, which is nothing more than another tax on businesses.  Elected leaders from the City and County refuse to learn that imposing taxes and mandates on people and businesses only serves to drive them away. 

The American Legislative Exchange Council (ALEC) has taken a look at state pension plans and the picture is not pretty: on average, these pension plans were 81 percent funded and carried a total of $359 billion in unfunded liabilities.  Pennsylvania-reflecting the SERS, or state workers pension plan-reported a funded ratio of 84 percent and $14 billion in unfunded liabilities.  Some states (DE, NY, OR) eliminated any unfunded liabilities while others (IL, LA, OK) were among those with low funded ratios.

With public pension plans assuming a high rate of return and being heavily slanted toward defined benefit type plans, the study notes that the solution lies in "fundamental reform".  This would mean looking at the level of benefits and phasing in new defined contribution (401k) type plans for new hires. 

This would be sound advice as the state inches closer to the date when huge rate spikes for its state workers pension plan and the teachers' pension plan as well as the multitude of local pension plans that are in trouble.

"I would characterize this contract as a good contract for both [the City and the Fraternal Order of Police"-that's what the head of the City's FOP said in a newspaper article yesterday when responding to a question about the newly negotiated pact between Pittsburgh and its 885 member police union.  It might be so good that the police membership may actually vote to ratify the contract instead of it proceeding to Act 111 binding arbitration, the latter being the norm for the past three decades.

There are no real details as of yet, but it will be interesting to see how the contract treats some key components of reform suggested by the Act 47 team in its amended report.  For instance:

• Civilianization: The recovery team noted that Pittsburgh "has an unusually high ratio of sworn officers to civilian employees", especially compared with other police departments around the country.  It suggested that some functions could be turned over to civilians.  The 2004 Act 47 report started this discussion, and the amended plan said that "the City needs to make more progress toward civilianization". 
• Overtime Reduction: The Act 47 team wanted the Police Bureau to "develop a comprehensive strategy for controlling overtime expenditures".  This could be accomplished by adjusting court time and overall scheduling.

Beyond these specific recommendations there are general goals of moving long-term benefit costs lower by looking for lower cost options on health care premiums and possibly lower cost defined benefit pension plans for new hires.  Recall that the last police (and fire) contract eliminated retiree health care for those hired after December 31, 2004 and put the onus for paying premium increases on retirees who did not retire by that date based on recommendations of the recovery plan. 

It is hard to fathom the hard work being over for the City and its largest bargaining unit, but the talk as of now makes it seem like the worst is behind them. 

A+ Schools, a group ostensibly concerned with improving education in Pittsburgh public schools, is very disturbed by the high turnover rate of teachers in the "most vulnerable" schools in the City.   Having discovered the turnover is significantly higher than in the less vulnerable schools, A+ recommends the District take steps to make the more vulnerable schools places where teachers would like to be.

What does that mean? Does it mean, in large part, having safe schools with manageable discipline problems where there is at least a chance of instruction taking place? If that is the case then we would suggest the A+ group rethink their recommendation.  If history is any guide trying to deliver the desired school environment is almost certainly a futile undertaking. Why not another approach?  Why not recommend providing students and parents who want to use them a scholarship or voucher to attend a non-public school of their choice? Schools where discipline can be enforced as opposed to public schools where excessive political considerations prevent principals and teachers from creating an environment conducive to learning.

If the A+ is truly concerned about the quality of education, they should quit playing enabler for the public school system.  If they want to spend a lifetime pretending they can push the schools in the right direction while wasting hundreds of millions of dollars and denying a large share of Pittsburgh's children a chance to get a good education all they need do is keep issuing studies and recommendations like the one discussed above.

No cards have yet been dealt, not a roulette wheel spun, and no dice have been tossed, yet several stakeholders are counting on table games to fund their budgetary needs.  In Allegheny County this includes the Carnegie Libraries and the Allegheny County Library Association, as well as the tourism agency in Monroeville.  Statewide there will be many others.

And this should come as no surprise: the original 2004 slots bill allowed for economic development handouts for debt at Pittsburgh International Airport, to pay off debts related to subsidy programs administered by Pittsburgh and Allegheny County, for a hockey arena, for the convention center, etc., etc.

Of course the state needs the licensing fee money for this year's budget and then when the table game enterprise is up and running it can count on recurring revenue.  As one state representative noted, using slots for budgets and economic development projects is the worst way to raise revenue "'except for all the other worst ways."

This all raises a line of inquiry: how would the state and the region fund its "needs" without the slot money?  Would the absence of $150 million for debt at the airport have forced the County and the Airport Authority to raise fees or possibly look at turning the facility over to a private operator to raise money and achieve efficiencies to retire the debt?  Would the City of Pittsburgh, caught in the quagmire of legacy costs, be able to find the money to pay off the Pittsburgh Development Fund?  How would the hockey arena be built?

As much as it would be desirable to witness, it seems awfully unlikely that the City and the County would have cut general spending in order to save money to devote annual allotments to these projects. 

Now that the Promise program has had a couple of years of operational experience, they have seemingly encountered a problem. Perhaps they have made a bigger promise than they can keep. So they are requiring students applying for Promise money to fill out the "Free Application for Federal Student Aid" (FAFSA) in order to leverage government assistance as much possible before receiving Promise funds.  What's up with that? We were led to believe from the announcement of the Promise that money would be there for the asking for all graduating seniors who met the grade and attendance requirement. Now they have to jump through the FAFSA hoop before their scholarship is granted.

What's worse, evidently a lot of students who can graduate from high school and presumably are ready for college cannot fill out the requisite forms so their families will need assistance in filling them out. But wait.  The FAFSA forms rely heavily on tax returns which, according to the Promise's executive director, many families have not done and are scared of the prospect. Little wonder. That will raise questions the IRS might be interested in getting answers to. In any event, the Promise program, in cooperation with the United Way, will offer tax preparation instruction to student families.  

But it gets worse. The tax preparation course will be open to the 3,700 student families who make up to $52,000.  One would have thought people making, say, $35,000 or more per year, would know about tax returns and would have done their own or had a tax preparation professional prepare their returns.

And, why aren't guidance counselors and other school professionals helping students fill out scholarship applications if they need it? That's what they are paid for. Using limited Promise funds seems like an egregious duplication.  Unless of course the real reason is that with the big jump in funding to $10,000 per year for students graduating in 2012, the program managers are starting to feel the need to direct students to other sources so as to reduce the amount the fund will have to provide.

That's the question that needs an answer the day following the Mayor's inauguration ceremony at which, when talking about how to close the gap between the assets and liabilities of Pittsburgh's pensions, he said "our options locally are extremely limited".

Recall that just a few months ago the Mayor practically begged for independence when it looked like the state was moving toward a modest reform of municipal pension plans.  Wanting a "chance to solve this locally" by leasing/selling parking garages, the bill was opened to get Pittsburgh out and the reform provisions were watered down to the point of being ineffective. 

So which is it?  On the one hand we see the Mayor wanting the supposedly "pain free" options of a boost to the $52 Local Services Tax (levied by a municipality on anyone who works within the municipality) or a way to wring money out of non-profits.  Even if the state were to entertain a request from the City-after having been told they were going it alone on pensions-and the $52 tax were to be increased, they would likely permit it across the state in all municipalities, thus increasing taxes on City residents that the Mayor says are taxed enough already.  And the non-profit community cannot conjure up money for the City without curtailing investment or cutting services to the City.

Maybe the Mayor has received initial numbers on how much the parking garage deal would net and is not happy.  Remember that the City has to show the state that the pensions are at least 50% funded by 2011 in order to avoid a takeover under the provisions of the current legislation.  The City wanted to meet that threshold by turning the garages over to the private sector-and the state needs to honor their decision. 

In a moment of economic lucidity, Pittsburgh's Mayor on December 31 vetoed the so called "prevailing wage" bill Council passed in the waning days of 2009. The late veto made it impossible for Council to put together the votes needed to overturn the veto.

The legislation, a last minute Christmas gift to labor unions, was passed on December 21. That opened the opportunity for the Mayor to veto the bill on the last day of the year.  One wonders about the Council's rush to pass the bill in the last few days with the very real threat of a last minute veto hanging over the process. Was all this carefully choreographed as a Council sop to the unions that was never meant to be put into effect? We will know if Council revives the bill in 2010 and overturns another veto.

The bottom line is the prevailing wage bill was terrible legislation and the Mayor's reasons for vetoing it were extremely logical. It would have made Pittsburgh even less competitive for attracting companies and investment into the City by aggressively interfering in the market's ability to set wages through supply and demand.

More devastating, it would have sent yet another signal to the local, national and global business communities that Pittsburgh is slipping deeper into an anti-free market, statist approach to public policy. 

We can only hope this poorly thought out and insidious bill never sees the light of day again.