Act 47 Conflict

Act 47 Conflict

Turns out there may be some budget discord in Harrisburg.  Except this does not involve the General Fund budget for state operations, but for the City of Harrisburg and its status as a distressed municipality under Act 47.

The City’s chief executive announced yesterday that there would be a hiring freeze for public safety personnel (the City has 454 employees total in all departments) and more attention to non-essential spending–the type of things that one would think would occur when in distressed status/oversight–unless there is some movement by the General Assembly on legislation that would allow the City to keep its higher than normally permitted taxes on earned income and local services that are in place while in Act 47.  City officials and some members of the General Assembly were hoping that language regarding Harrisburg exiting Act 47 but keeping the taxes would be part of the fiscal code.  That did not happen.

The City’s five year window of time in Act 47 is closing in September but it looks as though there will be a three year extension to keep the City in until 2021.  If the levies under Act 47 were eliminated upon exit from distressed status without substantial changes the City would return to fiscal emergency status in the opinion of the coordinator. Eight municipalities have been released from Act 47 status since 2014.