A newly released audit of the Allegheny County police by the County Controller’s office examined police operations from 2013 through 2016. The Department handles police calls on County owned property (the airport, parks, the jail) and does work cooperatively with municipal police departments. This year the County police is providing contracted service to the Borough of Wilmerding (which formerly contracted with another municipality) for a flat contracted amount and a percentage of fines in the Borough resulting from the County Police’s service.
A few weeks ago, in a separate piece on the proposal for voluntary municipal disincorporation we based the count of municipalities providing their own police service “in house” through the count of active employees reported in pension data. The audit surveyed each municipality in the County (beginning on page 27 of the document) and provides a solid comprehensive examination (where municipalities did respond) on the amount of budget for police service and officer minimum and maximum salaries. The data also shows where municipalities get their police service, and our count from pension data was pretty close (98) on the municipalities providing service “in house”–by the audit’s count there are 105 municipalities providing police service in this manner. 16 contract with another municipality, 4 are part of a regional/multi-municipal force, 2 get service from the state police, and 1 from the County (Wilmerding).
That data is important for two current policy debates, the proposed $25 fee for state police coverage in municipalities that rely on the state police, and the proposal for municipal disincorporation and the decision on service quality and cost.
East Bethlehem Township in Washington County voted last month to disband its police force, for “purely economic reasons” and will join a regional police force, effective August 15th. The First Class Township code, which governs the municipality, gives the township the ability to “enter into contracts with the proper authorities of near or adjacent cities, boroughs and townships either for mutual aid or assistance in police and fire protection…” A 2014 report on police consolidation and service coverage list two multi-municipal departments in Washington County.
An article from this spring on state police coverage and response calls in municipalities shows that East Bethlehem did rely on state police for part-time coverage. It would be interesting to know if the Township compared the costs of keeping its force, moving to a multi-municipal force, or taking on full-time police coverage from the state with the proposed $25 per person charge and what each scenario would mean for costs and service. Obviously the move from “in house” to a regional force is being sold as a money saver for the municipality compared to what they are spending now. It is not clear what happens to the part-time state coverage that was employed by the municipality.
Based on a survey conducted by the Pennsylvania School Boards Association (PSBA) of 332 of the state’s 500 school districts the approaching fiscal year is expected to be worse than the current one. That’s despite the new funding formula, more money in the K-12 basic education appropriation, despite fewer teachers and non-teaching staff compared to 2010, and talk of pension reform (which based on initial impressions is not expected to bring immediate relief).
The survey projects 70% (about 232 districts) of the respondents think they will raise property taxes. Taxpayers in Allegheny County’s school districts know that story quite well over the past decade. From the 2006-07 Fiscal Year through the 2012-13 Fiscal Year (seven fiscal years) the average school property tax rate rose from 21.94 mills to 23.89 mills (1.95 mills, or 9%). About a quarter of a mill each year.
When the County’s reassessed values went into effect and districts adjusted millage for 2013-14, the average rate was 20.22. Since that year, through the current one (2016-17) the average rate has climbed to 21.24. That’s 1.02 mills, or 5%, and again about a quarter of a mill each year. From fiscal year to fiscal year since the reassessment (FY14 to FY15, FY15 to FY16, and FY16 to FY17) about 50% or more of the districts in the County increased millage rates–not as high as the predicted percentage from the survey, but fairly consistent.
In June of 2015 the state’s Basic Education Funding Commission released its recommendations on a formula to distribute state dollars for K-12 basic education. In implementing the formula, the decision was made to apply it to only new dollars appropriated beyond 2014-15 allocations–leaving in place the “hold harmless” provision which ensures school districts would not get less than the year previous. The decision was made with the acknowledgement that doing away with it would have affected 320 school districts where enrollment had fallen, affecting $1 billion in funding.
Last week events were held around the Commonwealth, including one here in Allegheny County, which was also highlighted in an opinion piece after the meeting, essentially stating that state money is not keeping up with the costs districts are facing. Out east an event in Montgomery County stated that only 6% of the total amount of state funding for K-12 is currently driven through the Commission formula and looked at two districts in the County (Colonial and Pottstown, see second embedded slide in this article) and examines the state/local funding disparity (an issue we wrote about in the fall in regards to a lawsuit).
As we pointed out in that piece, with Lower Merion and Shenandoah Valley school districts cited by the petitioners, the efforts to equalize two such districts would require either a massive boost in state funding for one district or a reduction in local funding for the other, unless the state assumed responsibility for 100% of public school funding and allocated money to districts in a way that satisfied “fairness” and “equity”. An editorial on the Montgomery County meeting stated “Pottstown has become in recent years a poster child for differences in school funding between rich and poor districts”. If they are basing that off of the slide, it shows that Pottstown has a millage of 32.9 mills, more than twice as much as Colonial (13.4 mills) but the former raises $10,247 per pupil locally to $18,724 in the latter district. The state gives $2,500 more per pupil to Pottstown.
However, looking at the state Department of Education’s data on financial elements, including the aid ratios of market value and personal income, Colonial has a property tax base of $6.4 billion and an aid ratio of 0.15 while Pottstown has a property tax base of $1 billion and an aid ratio of 0.6752. Of course Colonial is going to be able to raise more locally than Pottstown; the state does give more to Pottstown per pupil, so is it the fault of the state that there ends up being a $6,000 difference in the end result? Should the state boost its taxes to make sure Pottstown spends at Colonial’s level? If so, how does it ensure that Colonial does not raise its taxes to cause a gap going forward?
As we have stated before, as long as local funding is part of the mix, and there are districts with a lot of property value that can raise large sums with low millage rates, there will always be disparities in funding from district to district.
Reacting rapidly against the President’s withdrawing from the Paris Accord, Pittsburgh’s Mayor in an executive order denounced the withdrawal as a dereliction of moral duty to the planet and to the legacy being left to children and grandchildren. There is no need here to go into detail about the serious flaws in the Paris Accord or to enumerate the many studies that point to the harm the agreement would do to the U.S. economy and the unfairness of the agreement that had U.S. taxpayers subsidizing China’s effort to curb pollutants, even though they do not have to actually reduce pollution until 2030.
It is important to note that there are many scientists who do not subscribe to carbon caused global warming and that predictions of climate catastrophe made 20-25 years ago have not happened. And the Paris Accord merely assumes that temperatures would rise. But in a scheme that redistributes wealth to underdeveloped countries they could insure universal participation to go along with the environmentalists in Europe who have made saving the planet their number one and apparently only meaningful goal.
But the Mayor’s order did not end there. In one of his “whereas” justifications for his order, he complained that Pittsburgh had a paid a very heavy price for the heavy industry that built the economy of the city and region. Now that is the definition of ungrateful. Without the industries that provided the engine of growth, the population of Pittsburgh and Allegheny County would never expanded to the dimensions it reached. Without the industries, the vast fortunes that built skyscrapers, funded the arts, built museums, hospitals and universities would not have happened.
Without heavy industry there would have not been the development of waterways infrastructure that create the stable pools in the three rivers that provide great views, recreation opportunities, and reliable water supplies and a place to put sewer plant effluent. Without the accompanying population growth and the discretionary income industries created for workers, it is doubtful that the Pittsburgh would have ever had the Pirates or the Steelers. And there is little chance Pittsburgh would have had a symphony or opera.
And needless to say, without industry and the fortunes it created, most of the large philanthropic foundations that have provided so much funding for a civic society, the arts, education and health would not have come into existence. Ironically, these same foundations are now major funders of many of the environmental programs that makeup the Mayor’s agenda. It appears alright to take money created by the industries he now deplores.
Finally, it hardly needs to be said but Pittsburgh is not a paragon of prudent governance. In a ranking of the top 150 cities in the U.S., Pittsburgh’s government ranked 144th on financial stability and 117th on per resident expenditures. The Pittsburgh school district is one of the most expensive in the state while the academic record in most of its schools is mediocre to terrible. The Mayor has a lot to worry about. And he continues to lose court cases because ideology trumps respect for the law.
Moreover, the Mayor faces a gigantic environmental problem that seems to keep getting swept under the rug. The water and sewer system is very old and the ancient pipes that are well beyond their expected useful life pose a clear and present danger to the water supply. A ruptured sewer line would be the worst ecological nightmare one can imagine. These problems will cost billions to be fixed but there is no reasonable alternative. We can dedicate bike lanes and tell building owners to curb nonrenewable energy use but the danger that lies under the City gets lip service.
Some municipal officials in Lackawanna County in Northeast PA are urging the county commissioners to conduct a reassessment, the first one in nearly fifty years. We wrote previously that the oldest reassessment year in the state, 1958 in Blair County, underwent a reassessment recently. Franklin County (1961), Lackawanna (1968), Crawford (1969), and Butler (1969) are counties with base years stretching back to the decade of the 1960s.
One county commissioner urged one of the municipalities to also pass a resolution supporting a school tax shift through an increase in personal income and sales tax, a piece of legislation that has been considered before but has not been introduced in this legislative session. The commissioner suggested that with no school taxes a “…reassessment would be more palatable”, which may or may not be the case. School districts are still required to reduce millage rates to comply with new reassessed values, but the school tax bill typically comprises the largest portion of the total (county, municipality, school). If the commissioners are relying on school tax elimination as a precursor to conducting a reassessment they may be waiting for many more years. But at least this commissioner did realize that just eliminating school taxes would not bring an end to the need for a reassessment.
Two members of the municipal council voted against the resolution due to fear that a reassessment would cause a tax increase for many. Again, that depends on the change in property value relative to the change in overall value for the three taxing bodies, assuming tax rates stay at the revenue neutral level. But big jumps in tax bills for properties after millage rates are adjusted to revenue neutral rates indicate those properties were underassessed.
There will always be plenty of reasons officials will cite to avoid conducting a reassessment. Especially important in a county where five decades has passed is the education effort to let taxpayers know how to estimate what will happen with their taxes and that a change in value of ten does not mean taxes will increase by a factor of ten.
The financial issues confronting the Penn Hills School District in eastern Allegheny County has prompted the state representative for the area to ask the state to place the District in financial recovery status under Act 141. The representative made a similar request in early 2016.
Under the Act a district is determined to be in financial distress if it has enrollment over 7,500 and gets an advance of its basic education subsidy from the state, or it receives an advance on its basic education subsidy and is either subject to a declaration of financial distress or is engaged in litigation against the state for financial assistance. As of now four districts are in financial recovery status: based on the letters from the Department of Education to each district there were advances of state basic education subsidies at various points to the four districts and one (Chester-Upland) was involved in litigation against the state. There are also five districts in “financial watch” status under the law.
The state says it will review the request, and decide how to proceed. In the meantime, with a fiscal year approaching for 2017-18 next month and a proposed budget that would raise taxes 4.76% (the millage currently is 26.3061, meaning the rate would rise to 27.55 mills) is under consideration.
Last month we wrote about board appointments made by the Mayor of Pittsburgh to the Pittsburgh Water and Sewer Authority; three members resigned even though their terms had expired at the end of 2016. At the time, two other members were also on expired terms and those two members are now under consideration for re-nomination to the board. One term would end next June, the other February of 2021.
The board named a new chair last week as well from one of three members appointed in March. Based on appointment votes by Council, the current serving appointees (including the two under consideration now, with the assumption that they are re-appointed) two terms would expire in 2018, none in 2019, four in 2020, and one in 2021.
These board members will be involved in a number of critical PWSA issues, including the proposed “restructuring” with a consultant and outside advisory panels, and now a possible proposal to put the Authority under Public Utility Commission oversight.
Compared to a peer group of transit agencies in other cities, the Port Authority (PAT) had a cost per passenger in 2015 of $5.79, highest in the group.
That comes from the Authority examining itself; we did similar work years before by looking at data from the National Transit Database, which is where transit agencies submit data on finances and operations on an annual basis. That 2004 piece found PAT operating costs were 18% above the average. The piece in the article based on PAT’s group shows an average of $4.85, meaning more than a decade later PAT was 16% above the average.
A PAT spokesman said that it hopes its current contract with the ATU will lower health care costs and the fare changes effective this year will boost ridership (“…the agency believes reducing fares will draw more riders from outlying areas, filling more seats on existing routes and thus reducing the cost per passenger”).
For 2015, in the NTD stats, PAT provided 65.2 million unlinked passenger trips. It has a service area of 775 square miles and a service area population of 1.4 million. Some of the peer agencies have much larger service areas (Denver, Seattle, and Baltimore’s agencies cover more than 2,000 square miles) and PAT falls in the middle on service population (it is close to Cleveland, St. Louis, and Portland).
PAT’s 2015 NTD profile shows that it had $377 million in operating expenses; with 65.2 million unlinked trips, the resulting $5.79 as quoted in the article is found. If the flat fare change can attract ridership to boost the number of unlinked trips to 70.2 million, the cost per passenger could fall to $5.34; assuming operating expenses did not change. If the hoped for health care savings through the contract are realized ($11.2 million over the four year deal) and, assuming other factors in the budget will grow at about 3% per year, the budget in 2021 would be around $411 million. If ridership does not grow and stays flat at 65 million, the cost per passenger would be $6.32. If ridership grows by ten million unlinked trips at that budget amount it would fall to $4.78.
Should taxing bodies be able to appeal property values based on the sales price of the property compared to its assessed value? Opinions differ on the matter. In Allegheny County last year taxing bodies filed 3,853 appeals (7,143 appeals in total were filed). Legislation pending in the General Assembly would prohibit the practice. The legislation would permit appeals on values following a countywide reassessment filed by September 1 or the appeal date established by the county in the year after the reassessment, if the land is divided, or if the property’s use changes.
The legislation is similar to an effort undertaken about a decade ago through similar House and Senate bills which were ultimately vetoed by the Governor at the time, which we noted in a 2014 Policy Brief. In his veto message he noted “… new homeowners who purchase their homes based on one set of assumptions about their property taxes (that is, the property tax rate prior to purchase), only to find that they are required to pay much more in taxes than they expected or can even afford upon a school district’s successful appeal of the fair market value of their property”. However, without a regular cycle of reassessments, the Governor felt he had to veto and called for the long-term solution to the problem, which would be “…regular assessments at the county level”.
Since that 2008 veto, 16 counties have or are planning a reassessment, and there is still no legislative mandate on when a reassessment has to happen. One observer of the issue noted in the article that the meaningful change would be a regular assessment schedule–nine years after the Governor at the time called for it.