Oversight Board Votes on Budget, Receives Audit

Oversight Board Votes on Budget, Receives Audit

Two issues related to the Intergovernmental Cooperation Authority for Cities of the Second Class (oversight board).  One is that the board took action on the City’s 2018 operating and capital budgets and approved it 3-0, with two members of the board abstaining from the vote.  One member noted that there could possibly be a tax increase taken up by City Council, which would then require reconsideration by the board.  That’s not the real story–the fact that the board now has five functioning appointees and can carry out business is.

Consider that in December in 2015 there were only two appointees and the Mayor of Pittsburgh noted that there weren’t enough members to vote on matters before the board.  We suggested that the appointing officials responsible for filling those seats make the appointments and then “They could vote together to advance ICA business, even if it occurred on a series of 3 to 2 party line votes. A 3 to 2 partisan vote would release gaming money the City receives from hosting the Rivers Casino (a critical issue in the current dispute), approve operating budgets, and make City-overseer relations much more amicable.”  The appointments were made by March of 2016.

Two, not long after problems with the executive director of the oversight board surfaced, and in April of 2016 we wrote about the failure of the oversight board to comply with state law requirements on the audits for the entire history of the board’s existence.  this past April we updated the status of the audit for 2015 and 2016 which was delayed due to the involvement of the District Attorney’s office.  The audit has now been released and is available on the oversight board’s website.

The audit does discuss the details of the investigation and how it impacted the audit.  The financial position of the oversight board at the conclusion of Fiscal Year 2016 (June 30th) shows a net position of $19 million with most of the liabilities tied to restricted uses for the City via the board’s intercept agreement of the host fee money from the Rivers Casino.  That money is to be used for debt reduction, pensions, or any other purpose deemed to be in the best interest of the City per the gaming law.  For 2016 revenues and expenditures, the bulk of the $9.8 million in revenue received by the oversight board was from the gaming money, along with a $250k appropriation to operate, and it had expenditures of $3.5 million that fiscal year.

Under changes signed into law as Act 99 of 2016, the audit required under Section 207 going forward are to be completed by December 31st following the end of the fiscal year.