City Pension Reform, 1996-2009




Funded Ratio



Competitive Pittsburgh


Pension Bonds, Use Savings from Bond Sale or Debt Restructuring to Reduce Obligations




Seek additional state aid, Establish defined contribution plan for new employees


Initial Act 47 Plan


Make pension payments at beginning of year, ask state to amortize liabilities, re-evaluate pension contribution levels


Mayor’s First Financial Forecast


Close loophole on state pension aid, hold harmless for workforce reductions


Mayor’s Testimony to Senate Urban Affairs and Finance Committees


Revise state aid, prevent spiking, permit defined contribution plans, consolidation of plans into a statewide system


Amended Act 47 Plan


Contribute $10-14 million more per year to pensions, evaluate pension bond funding, no pension enhancements, explore a new, lower cost defined benefit plan for new hires


Mayor’s Plan and Act 44 Provisions


Sell or lease all Parking Authority garages, lots, and meters and put proceeds into pension fund, Higher ed tax, freeze of parking tax at 37.5% with 6.75% used for MMO, permit an additional 2.5% on parking if all garages are sold with 100% of that tax going to MMO



Will Legacy Costs Force Pittsburgh Into Chapter 9 Bankruptcy?

“…the notion that the second largest city of this Commonwealth would record the unprecedented status of bankruptcy is simply an unacceptable alternative”-

Report of the Intergovernmental Cooperation Authority, April 12, 2004


Five years ago when the City was new to Act 47 status and the oversight board was getting its bearings there had to be some inkling of a very real possibility Pittsburgh could find itself in front of a bankruptcy judge.  The City was characterized as being saddled with an outmoded tax structure and out of budgetary gimmicks to meet its spending needs.  Per capita debt was far out of line with other U.S. cities. To forestall a worsening situation, the state had approved the City’s petition for Act 47 status, created a new, separate oversight board, and enacted a tax reform package for the City.   


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Pittsburgh Encounters Pension Reform and Doesn’t Like It

If the health of Pittsburgh’s three pension plans doesn’t soon improve and if pending municipal pension reform legislation becomes state law, the City will see its oversight and administration of the plans transferred to the state and all future employees will become members of a new, uniform system of pension recipients.


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