Allegheny Institute Blog

The debate continues over City Council’s discretionary spending problems. After ethical questions arose in light of Councilwoman Carlisle’s spending on consultants—nearly $178,000 since 2002—Council has sought to solve the problem with more “stringent” rules on spending. But why have individual discretionary accounts at all?

Currently members of City Council are allocated $85,000 per year, down from $99,000 in 2002, to spend as they see fit with most spent on staff salaries. A proposal has been given preliminary approval that would require most of that money ($77,000) be spent on staff salaries without being able to shift this money to an expense account ($8,000). Furthermore any consultants being paid more than $10,000 would have to sign contracts and provide detailed evidence of work performed. Any requests for travel, education, training, or professional services would have to be approved by the council president.

Here’s a better idea: eliminate any slush fund spending by individual council members. If the money is to be used for the betterment of their districts, as some members claim, then pool the money and bring any spending ideas before the full council for a vote. If the idea is worthy of funding, it should easily pass council as well as public scrutiny. Complete expense reports should be submitted and audits performed every quarter. This eliminates any hidden agendas, or spending on friends and political allies. Complete transparency is not only demanded of the City’s elected officials, but deserved by its citizens.

http://www.post-gazette.com/pg/06151/694515-100.stm

Here are the facts behind the case of a McKeesport public school teacher who admitted to having sexual relations with another teacher at the district’s intermediate school over a two-year time frame: the sex occurred in a classroom and in a men’s restroom while other teachers “ran interference” and served as lookouts; the teacher—a thirty year veteran making $73,000 per year—was on paid, not unpaid, leave since admitting to the relationship; and the retirement package received by the teacher amounts to $58,000 for unused sick and personal days. He will also retire with his pension intact, amounting to about 75 percent of his salary, or $55,000 per year.

The teacher won’t be entitled to the customary decade of paid health care received by teachers when they retire. How sad for him.

That this “educator” was not immediately fired and denied all the generous benefits shows the power of the education unions and how a lot of school board members are either complicit or fearful. There can be no other explanation. In this case, the district should have denied the benefits and gone to court if necessary. Settling this case, with these circumstances, creates a really bad precedent. According to one dissenting school board member, the teacher was paid for unused sick time at the full daily rate, while other retirees usually get 50 percent for each unused day. Either the board members who voted for the settlement are stupid or unwilling to take a little heat from the unions.

In effect, this breaker of the rules of decency and ethical conduct is let off with barely a slap on the wrist.

What a lesson for the district’s schoolchildren! And what an insult to taxpayers! Thank you, Pennsylvania teachers’ unions. Great job undermining society’s already tenuous grip on morality and decency.

As school districts set budgets for the upcoming school year, many are offsetting spending increases with millage hikes, while some are pondering significant expenditure cuts. The Duquesne City School District has proposed eliminating seven teachers, a school psychologist, a librarian, and a guidance counselor. Naturally the media, and of course parents, are all atwitter over these reductions calling them “grim”. The reality is that the District has experienced substantial enrollment declines and the state projects this decline to continue for the foreseeable future. Thus, some employee cuts are understandable inasmuch as they reflect recent and prospective enrollment drops.

According to the state Department of Education, for the 2004-05 school year (the most recent data available), Duquesne spent $13.1 million or more than $14,500 per-pupil for 900 students. Yet this district ranks at the very bottom of the state’s school districts on Pennsylvania’s education assessment exams. The proposed 2006-07 budget of $12.9 million does not represent a steep reduction. In fact, taking the drop in enrollment into account, the per-pupil expenditure for next year actually rises to $14,900.

If there is a group that should be gnashing their teeth, it is state and federal taxpayers who, year after year, continue to fund over 80 percent of the District’s costs by pouring millions into Duquesne schools only to receive an astoundingly poor return on their investment. Why can’t the school district educate its students with more than $14,000 per student in spending? And why should taxpayers throw good money after bad? With its high expenditures and awful education results, this district does not deserve more money; it deserves to be shut down.

If these children are to be adequately served and taxpayers are to be given a fair return on investment, then drastic changes have to be made. Either bring in a private firm to run the District or give parents vouchers and let them choose a school that best suits their needs. Or send them all to a cyber charter school. Do something positive to get them out of this unfixable morass. And quit listening to the educrats who keep saying that with more money they can set things right. The time has come to take care of the students and abandon the education establishment, including present and past school boards, who obviously do not care about the kids’ future or they would not put up with this mess.

To say there is a lot of fanfare surrounding development in the Fifth and Forbes area of Downtown would be an understatement. Condos, retail, green space, offices, hotel rooms, and even a new skyscraper—all of these projects seem to be coalescing to deliver on the promises of revitalizing the decaying downtown.

Smiles abounded when the Mayor selected Millcraft as the master developer for properties on Fifth and Forbes owned by the URA. The grins got even bigger when it was announced that the developer would not seek subsidy from the City or the County. This signaled that perhaps the days of developers coming to Pittsburgh with hat in hand were over.

Not so fast.

Even though the City and County won’t be tapped, signs are pointing to the state being asked for help, and don’t be surprised if the state obliges. The state is already kicking in $30 million in assorted funds to the PNC Tower proposal (on top of a TIF) and, given that the Millcraft project will cost about $71 million, subsidies from the state for PNC and Millcraft’s developments could exceed $42 million if the state funds about 20 percent of Millcraft’s plan. Whether it comes from the city or the state, public money is public money.

The problem is that grants to downtown construction of office and retail space inevitably create subsidized competition for existing businesses and property owners. This is never a good thing. It only leads to more cries for subsidies until nothing gets built without one. The return to taxpayers, which in many cases is nil to begin with, falls with each new subsidy. But in Pennsylvania, officials will not look beyond the ribbon cutting to see the long-term consequences of their ill-conceived behavior.

“Phantom budgets” are becoming the norm in Pennsylvania. What are they, you ask? They are budgets passed by local governments or authorities that include new, non-existent sources of revenue that they hope the state will authorize. The City of Pittsburgh did this is 2003 when it included a then unheard of payroll preparation tax and an alcohol tax. Now the Port Authority and the other public transit systems in the state are preparing for the 2006-07 fiscal year by leaving gaps that they hope the state and its transit reform commission will fill.

PAT’s budget will be $387 million, with $31 million (8%) more in spending than revenue. Though it has been implied that the Governor’s commission will find some new revenue source for mass transit, that is not its sole charge. It is to come up with solutions—on the revenue side and the expenditure side—for all forms of transportation in the Commonwealth. One of the items it has heard testimony on is how competitive contracting can lead to cost savings for mass transit agencies.

For now, PAT, SEPTA, and the other agencies are going to budget on a wing and a prayer. That’s much easier. With the commission finishing its work in November, the legislature adjourning soon after and then convening in early 2007, the pressure to “do something” will be intense. It would not be surprising to see another band-aid applied (like moving more highway money) to shore up transit.

So once again, taxpayers will be hit with the tab because the transit authorities are unwilling—bolstered by the Governor and other elected officials—to use outsourcing as a way to save tens of millions of dollars.

It is time for the Legislature to put an end to the constant raping of taxpayers in order to satisfy the insatiable demands of transit workers.

The City Planning Department likes the Station Square gambling proposal more than the plans to put a casino in the Hill District or on the North Shore, but its preference carries no weight.

The community of Penn Hills supports the Isle of Capri plan, and Council even passed a resolution supporting it, even though the casino will not be located in Penn Hills.

Sound absurd? To say the least. In the case of the City planning department, state law required the department to rate proposals on factors related to transportation and interpret the findings for City Council and the Mayor, even though “the intent of the analysis is not to make a recommendation”, which, if it did, would not matter anyway. As we have known since the gaming law was passed almost two years ago, the seven-member Gaming Board will make the final decision. That did not dissuade members of Council from cross-examining the planning director on the report’s findings. Hopefully, City funds were not expended to pay for the study.

In the case of Penn Hills, it seems as though a former elected official is making rounds in support of the Isle of Capri/Penguins plan. It is not clear if a representative for the Harrah’s/Station Square plan or the Majestic North Shore is doing the same. In other words, the Council may have heard from one group and decided to endorse it without hearing from the others. The Council’s action is almost as useless as one from Pittsburgh City Council weighing in on foreign policy or U.S. Supreme Court nominees.



http://www.post-gazette.com/pg/06138/690970-56.stm

http://www.post-gazette.com/pg/06142/692205-100.stm

All of the House’s 203 seats were up for re-nomination. To be sure, the House was much more affected by members not running (29 in all) than the half of the Senate in the primary. That left 174 incumbents running for re-nomination.

There were 159 incumbents that were re-nominated, with 119 of those not facing a primary challenger. That leaves 40 House members that beat a challenger to win his or her primary. 15 incumbents lost to a primary challenger and will not return to Harrisburg.

Again, looking at how the 174 incumbents fell on party lines and their vote on the July 2005 pay raise, Republicans who voted for the raise were hit much harder than the Democrats.

There were 95 votes for the raise, with 45 Republicans and 50 Democrats voting for the increase. 36 Republicans won re-nomination, and 9 lost. Of those re-nominated, 26 had no primary opponent, and 10 successfully overcame primary opposition. Of the 50 Democrats, 46 won re-nomination and four lost, three of those from Western Pennsylvania. 30 of those that won re-nomination for the Democrats were unopposed.

75 votes were cast against the pay raise, 47 Republicans and 28 Democrats. 45 Republicans won re-nomination, with 35 of them unopposed. Two no votes were ousted. On the Democratic side, all 28 incumbents were re-nominated, two of those winning over primary opposition.

In all, 13 incumbents who voted for the pay raise lost. Along with those there are 23 retiring members who voted for the raise, meaning that 40 pay raise voters are not going back to Harrisburg.

There were 25 seats (one-half of the chamber) up for re-nomination in Tuesday’s primary. With three members retiring, that left 22 incumbents actually running for re-nomination. Of the 22, 20 won re-nomination, and 17 did so without opposition from their own party. There were five contested primary elections (all for Republicans) which cost two incumbents—the President Pro Tempore and the Majority Leader—their seats.

What was the impact of the infamous pay raise?

Of the 22 running incumbents, 10 voted for the pay raise (six Republicans and four Democrats). For the Republicans, four members won re-nomination (three faced primary challengers) and the two leaders lost. All four Democrats won re-nomination, and all did so unopposed in their primaries. Voting for the pay raise definitely hit the Republicans hard in the Senate with only one senator of six running unopposed in the primary.

Those twelve senators voting against the pay raise (six Republicans and six Democrats) all won re-nomination, and quite easily. All of these members ran unopposed.

So, just how significant were the results of Tuesday’s primary election? With the legislature’s July 2005 pay grab on the minds of voters, there was a real increase in the number of primary challengers to incumbents than in previous years. That, coupled with retirements prior to election time, held the promise for change.

The biggest impact was the defeat of the Senate’s top two leaders, who were linked with the pay raise. The House leadership—the Speaker, minority leader, and minority whip—all held their seats, meaning that stewardship of that chamber remains firmly in place. The vote count in the races for the minority leaders (both won with roughly 60 percent of the vote) shows that voters in those districts are more concerned with having officials who can bring home the bacon, regardless of how self-serving the actions of those leaders were.

In the region, there were twelve House incumbents (11 Democrats and 1 Republican) that voted for the pay raise and faced primary opposition. Four of those twelve lost their seats and will not return to Harrisburg. It is interesting to note that the 1 Republican was one of the four.

It is hopeful that some incumbents will not be returning to the Capitol. But the fact that so many of those in support of the pay raise will be going back makes us wonder if any long-term progress will be made.

President Bush finally took a stance against illegal immigration. With his speech Monday night, he outlined a plan to send National Guard troops to help secure the border with Mexico, use high-tech surveillance, and begin cracking down on the problem of illegal immigrants. However, his speech was a thousand days too late and not strong enough.

The President, finally acknowledging that something has to be done, has compiled a plan to use National Guard troops to help construct fences and other barriers along the border with Mexico as a way to keep illegal immigrants out. However, his plan will keep the Guard’s activities to one of assistant to the border patrol as they will not be involved in direct law enforcement activities. Will a toothless Guard be effective?

He wants to create a “temporary guest worker program” to help employers find workers for jobs Americans won’t fill. This canard has been the lead argument for pro-immigrant advocates for years. Yet studies have shown that the unemployment rate for low-skilled Americans in these occupations is very high. The more appropriate argument is that employers are unwilling to pay Americans a proper wage to do these jobs and thus look to illegal immigrants as a source of cheap disposable labor. The President asks for compassion for people who want to come here, yet does not show compassion for low-skilled Americans whose jobs are being taken and wages depressed by illegal immigrants.

He then gives employers a pass on hiring illegal immigrants by claiming it is too hard to verify documents. This should be the first priority of any crackdown on illegal immigrants. If the government starts levying heavy fines or shutting down employers who hire illegals, then jobs will start to dry up and fewer will cross the border illegally.

He does get it right by noting that amnesty will only encourage more to cross the border. We witnessed this with the amnesty of the late 1980s when 3 million were granted legal status and twenty years later we now have 11 million illegals awaiting the same gift. But his plan is tantamount to amnesty. By saying that rounding up all 11 million would be too difficult a task is sending the message that the government won’t even try. This stance will not deter new illegals from entering, it may even encourage more.

The President’s immigration plan may be too late and a few dollars short, but it is about time something is done. However, token efforts will not secure this nation. The government, and the President, needs to make it clear to those wishing to enter this country that illegal entry will not be tolerated. Those who are already here illegally must be ferreted out and sent home. Employers hiring illegals must be prosecuted. The border with Mexico must be secured absolutely. We don’t need more immigration laws; we need to enforce those already on the books.

The Governor was at it again, promising more wealthfare to firms in Pennsylvania. He plans to ask the legislature to bestow $30 million on firms in the alternative fuels industry over the next six years. The goal, he claims, is to reduce the state’s dependence on foreign oil while encouraging the production of ethanol based fuels in the Commonwealth.

While there are currently no firms producing ethanol in the state, they are already lining up, hat in hand, to accept this largess. Evidently it is not profitable to open such a plant on its own merit, but with a government subsidy, it just might work. If not, these firms can always ask for more handouts.

Keep in mind that ethanol has not been a proven replacement for gasoline. The National Ethanol Vehicle Association notes that cars running on the fuel get lower fuel efficiency while the cost per gallon ($2.69) is not much lower than the current price of gasoline ($2.89). Few vehicles are equipped to handle the new fuels and there is only one station in the Northeast. Will the state begin subsidizing the cost of ethanol stations as well?

Even the Sierra Club sees this for what it is—pandering to the hysteria of higher gasoline prices. As their national press secretary notes, “(w)e couldn’t possibly produce enough ethanol to make up for all the oil we use because there isn’t enough space to grow the crops to make it.” Furthermore it takes large amounts of fossil fuels to produce and process the crops needed to make ethanol.

The money for this program, from the fuel tax paid at the gas pumps, will be diverted from research and development that encourages the use of natural gas in vehicles. Could it be that this alternative fuels agenda will succeed where the other one failed? If the governor wants to help drivers in Pennsylvania, this money would be better spent on badly needed infrastructure repairs such as on roads and bridges—as the gasoline tax was originally intended. Of course in an election year, helping drivers is not as important as helping one’s own reelection campaign.

http://www.post-gazette.com/pg/06131/689204-85.stm

The Pittsburgh Business Times has once again released its “50 Highest Paid Employees” for Allegheny County and the City of Pittsburgh. The listings do not cover authorities, so that leaves off folks working at PAT, the URA, and others, and compensation includes the pay made from overtime, premium pay, sick and personal days, etc.

Every member on the Top 50 list for the City came from either the Police Department (4 people), Emergency Services (7 people), or the Fire Bureau (39 people). The highest earner came from the EMS at over $145,000 in compensation. When one considers the starting salaries for these departments, they realize the power of public safety employees to win significant benefits under the state’s binding arbitration law, Act 111. There can be no other explanation when public safety employees are making earnings well in excess of other elected and appointed City officials.

It is a bit of a different picture in the Top 50 for the County—only 20 out of the 50 that made the list came from either the County Police or the Sheriff’s office. Of course, the County does not have a professional fire department to negotiate with like the City does. In fact, the top earner for the County made less than three people from the City’s list, two of those from the fire department.

It is also interesting to note that none of the Top 50 on the City’s list (once again, all public safety workers) made less than $104,000 in 2005, while over 40 in the County—including a lot of department heads—did.

In short, 70 percent of the Top 100 wage earners in the City of Pittsburgh and Allegheny County were public safety employees. Yet they only account for about one-fourth of the total employment of the City and County governments.

Along comes another poll purporting to gauge Pennsylvanians’ view of the direction the state is headed. And it comes as no surprise that there is a lot of dissatisfaction out there. According to the latest “IssuesPA/Pew Poll”, half of those surveyed aren’t happy with the state’s direction and 67 percent say the legislature can be trusted only some of the time or never. Ouch!! What an indictment of elected officials.

But will the public’s dissatisfaction with the legislators translate into a major ousting of incumbents? Probably not. People complain about the legislative bodies but think their own representative or senator is doing a good job. Otherwise, how does one account for the 98 percent reelection rate of incumbents?

So what people are really saying is either: (1), the General Assembly as an institution is flawed and produces bad outcomes, or (2) a majority of legislators other than their own are rotten people. Or it could be a combination of the two. If the General Assembly is a faulty organization then we will probably need a Constitutional Convention to fix it, assuming it can be fixed. If people believe that legislators other than their own are bad then unconsciously what they are saying is, “my fellow citizens are pretty stupid or too lazy to do anything to replace the dreadful lawmakers.” Not a very attractive view of one’s fellow citizens. But is it a wrong view when voters continue to reelect legislators who have arrogantly used their office to enrich themselves or friends.

Sounds like an argument for term limits. The cost savings would be substantial. No need for pension plans or lifetime medical benefits. Legislators could focus on solving the state’s problems and not have to kowtow endlessly to powerful special interests.

After one 12-day strike in the early part of this school year followed by the threat of another, teachers at the Penn-Trafford School District reached a settlement on a contract dispute. The details were not released. But the results of this accord have come home to roost for district taxpayers. The school board voted to approve a new budget that includes a 5-mill (7 percent) tax increase. The reasons for the tax increase, according to the board president, are the salary increases in the new contract as well as an increase in health care costs.

During the often contentious negotiations, many parents sided with the teachers and pressured board members into giving them what they want. How many of the “give them what they want” crowd also complains about their property taxes? School property taxes account for two-thirds of a property owner’s tax bill. Were these parents aware of this when they pushed for salary increases or will they happily pay the higher millage?

Allowing teachers to hold a community hostage through the right to strike has led to an escalation of teacher salaries, and as a result, the cost of education. Since funding comes from taxpayers, they are the ones who ultimately pay more and more. Two things need to happen to break this cycle. First, the right to strike needs to be eliminated. Strikes give teachers the upper hand in negotiations by pressuring the school board to give in to its demands. Parents, who are inconvenienced by the strike, often take the teachers’ side and become accomplices in this pressure. Secondly, voters should have the right of referendum on all millage increases for any school spending. Those in education should be held accountable for the spending of taxpayer money. Until these measures are put in place, there may be no end in sight for higher taxes to fund education.

http://www.post-gazette.com/pg/06129/688659-56.stm

The Kiplinger “50 Smart Places to Live” is the most recent compilation of “best places to live” or “relocate” list that has garnered the attention of Pittsburgh boosters: this is due to the fact that the City (really the metro area) was ninth on the list. The ranking was assembled by a survey of the magazine’s readers who listed the factors most important to their decision to put down roots. Not surprisingly, costs associated with housing topped the list and was the driving factor in the survey. Other items like crime, weather, and commute times were also figured in.

The data accompanying the narrative shows that, among other things, Pittsburgh was one of only two areas to lose population (Abilene, TX was the other—how can a place be smart if people are leaving?); there were six other cities with median home prices lower than Pittsburgh ($105,040); and the one-year home price change in Pittsburgh (5.5%) was bested by two-thirds of the 50 places.

There is no doubt that Pittsburgh is affordable: but is it a smart place to invest in a home, where property tax rates are sky high? Is it smarter, for instance, to buy an average price home here and take the annual 5.5 percent growth in value as opposed to paying a little more somewhere else and having the home appreciate faster? It would seem the latter might be smarter, at least financially. But we can’t tell from the article.

And though the Kiplinger list gave points for economic vitality to “well-diversified economies that are good places to start or expand businesses”, there is nothing in the data that shows how Pittsburgh did on this measure. No data on what constitutes a “strong economy”, in their words, is present.


http://www.kiplinger.com/personalfinance/features/archives/2006/05/intro.html

The Census Bureau report on domestic migration shows that 34 Pennsylvania counties lost population due to net outmigration of residents to other counties or states. The single biggest loser is Philadelphia City/County which saw over 108,000 local residents depart the City between April 2000 and July 2005. Other counties in the Southeastern part of the state have been the destination for many of the departing Philadelphians. Likewise, Monroe and Pike Counties have seen their in-migration boom continue as folks flee New York and New Jersey.

The loss of population from Philadelphia is mitigated somewhat by a high birth rate but the City is still witnessing a substantial decline in population. A migration loss of domestic citizens of the magnitude that Philadelphia is undergoing cannot bode well for the future of the City. When people are leaving a community in these numbers, it speaks volumes about the quality of life in the community including concerns over taxes, schools crime, etc.

While the outmigration of Pennsylvanians overall has slowed somewhat during the past five years, there is no solace in the fact that the two largest counties continue to experience a major outflow of citizens to other parts of the state and country.

The Governor is livid over the refusal of the House Republican leadership to bring the property tax relief for seniors to a vote. Maybe the Governor now understands how Republicans must have felt when he vetoed the modest tax cuts for Pennsylvania’s businesses earlier this year, a bill they had worked hard to get passed and one that could have sent a positive message to the state’s business community.

The Governor followed that veto with another one on the needed and sensible voter protection bill that would have ensured that people showing up to vote are in fact who they say they are by requiring ID.

But beyond the tit for tat, the tax relief bill was nothing more than pandering to certain voters and did not deserve to pass. Obviously, there is a crying need for meaningful tax relief for all property tax payers. But that reform must include some measure of spending reduction in addition to any shift of property taxes onto other taxes.

And if the legislature and the Governor are really serious about doing something for taxpayers they will enact a bill that requires a voter referendum for every tax increase with no exemptions to the referendum except for emergencies resulting from an act of nature. They could also repeal the right to strike by teachers and other public employees such as transit drivers. Eliminating the prevailing wage law would be very helpful as well.

We will know the Governor and legislative leaders are serious about helping taxpayers when they propose legislation to launch any of these real spending reduction measures. Until then, the debate will continue to be a sterile round and round exercise of trying to decide who the winners and losers in the tax reform legislation will be. We know where that gets us—nowhere.

For years we have been documenting the poor record of academic achievement in the Pittsburgh Public School System. Now an evaluation by Washington DC-based Council of the Great City Schools has once again verified our work. Pittsburgh students have consistently performed poorly, despite the enormous sums poured into the district from city and state taxpayers—$17,000 per pupil.

The report indicted the district by noting it “sets low academic goals” and is “unable to accelerate student achievement”. It accuses the district of using standards that are high enough to satisfy federal regulators but not high enough to provide a decent return on taxpayer investment. Furthermore, the district has “a weak accountability system” and a “fractured instructional program”.

The Council of Great City Schools did not need to spend time and money to draw these conclusions. A look at PSSA results demonstrates the poor academic performance of the students. Less than 40 percent of 11th graders are proficient in math and the trend has been flat for the last five years. In reading, they fare a little better with 51 percent scoring at the proficient level. 11th graders are on the verge of entering the “real world” and yet half or more clearly lack adequate skills to go on to higher education or good paying jobs.

This report provides a scathing indictment of the public school system in Pittsburgh—a district that costs too much and performs abysmally. Clearly, a poorly performing school district works to the detriment of a City struggling to recover financially. City and state taxpayers deserve better for the $17,000 per student they are spending.

The Pennsylvania Senate just passed—and the House is considering—a property tax reform bill that offers relief to seniors and requires a voter referendum for school taxes that grow faster than the rate of inflation. Unfortunately, the bill contains so many exemptions to the referendum requirement that it has been rendered impotent. If more money is needed to cover rapid growth arising from costs due to health care, pensions, construction, or special education, a referendum will not be required.

In short, the factors that are currently driving most of the increase in school costs will be allowed to continue to grow as fast as the teachers unions demand and school boards agree to let them. Taxpayers will continue getting stuck with the bill and have no voice in stopping the outsized increases.

Moreover, since the tax relief bill is aimed at seniors, it fails to address the problems younger working families are having making ends meet. And it does nothing to help businesses who must also pay property taxes. While helping seniors is compassionate and generous, the state really needs to worry about the taxes that prevent businesses from expanding and creating jobs. Otherwise, the anemic job growth and the outmigration of Pennsylvanians will continue, particularly in the higher tax counties such as Allegheny. The vicious cycle will be sustained. The more we ignore the underlying problems, the greater the burden on those left who can pay and the more incentive they have to leave.

The movement of people, businesses and capital from Pennsylvania is the ultimate referendum. There is a vote taken, but instead of a regular ballot, folks are using their feet. Every day becomes an election day. The Commonwealth can continue to pander to voting blocs and watch the unpandered groups vote with their feet, or it might decide to address some of the causes of high property taxes and bad business climate that hamstring the state’s economy.

The referendum that matters is the one where people decide they’ve had enough.

Here we go again. Poor Duquesne City School District gets neglected while rich Upper St. Clair receives more state largesse. While we vigorously disagree with the Governor’s decision to grant money to USC for the continuation of a questionable program, the fact is the Duquesne School District receives far more state money per pupil than USC. For the 2004-05 academic year the state bestowed $7.7 million on Duquesne schools. With only 775 students, the per-pupil state subsidy is just a few dollars short of $10,000. In contrast, the state granted USC $8.1 million. However, with more than 4,100 students, the school district’s state funding is just under $2,000 per pupil.

By now it should be general knowledge that the state underwrites a much greater percentage of educational expenses in poorer districts than wealthier ones. For Duquesne, the state picks up the overwhelming majority of operating costs while Upper St. Clair receives only 18 percent of its funding from the state.

The real outrage is that for their efforts, state taxpayers are getting a very poor return on dollars sent to Duquesne because the district’s academic performance is abysmal. It should be possible to provide a good educational experience with just the state’s $10,000 per pupil contribution--and certainly with the $11,000 or so when the local tax money is added. Simply throwing money at education to get better performance is a fool’s errand. If it money were the answer, Pittsburgh’s operating cost of nearly $17,000 per student would be accomplishing academic miracles.

It is not an understatement that the debate on the corollary “benefits” of gaming has been hijacked in Pittsburgh. It has been hijacked by the Penguins’ desire to use the prospect of a casino as a way to fund its arena. That’s why the organization has joined forces with the Isle of Capri, one of the three applicants for Pittsburgh’s sole stand alone casino.

Consider it a miracle that elected officials have even convinced the other two applicants for the license to decide to contribute to the arena even though they never intended to in the first place. Majestic—which proposes to put a casino on the North Shore—would spend $7.5 million a year for thirty years to make sure an arena is built. Forest City (Station Square), has been more lukewarm, but they appear to be willing to contribute.

With all three applicants—two of whom had no intent of including an arena in their gambling plans—helping to make the idea of an arena a real possibility, the Penguins’ front office could only react with venom at the “sense of complacency” they see coming from the County Chief Executive. And this because the Executive had the gall to say that with all three applicants helping make an arena feasible that the issue was solved. Or could it be that the Isle of Capri plan is the only one out there that does not require the Penguins’ to put up some of the money to build the structure?

All we have heard from the Penguins’ organization is that Pittsburgh is not being urgent enough with the issue of the team’s lease. Let’s be clear: the City, County, the Sports and Exhibition Authority, and now the state’s Gaming Control Board have all considered the Pens’ situation. Not a lot of issues make similar rounds in a time-span of less than ten years.

The Penguins’ made the decision to join with Isle of Capri. They had their say in front of the Board. Now they need to let the deliberative process work out.


http://www.post-gazette.com/pg/06119/686062-61.stm