Tag Archives: Allegheny

What to Make of 2013 County Budget?

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Tomorrow evening the County Chief Executive is expected to present the budget for 2013. This will be the first budget for the current Executive as this year’s budget was enacted in December of 2011 after he was elected but before he took office. The budget was unsigned by the previous Executive and contained a 21% property tax hike.

This year’s plan is expected to finish out at $784 million: the bulk of it, $676 million, is in the general fund, $76 million in debt service, $4 million in liquid fuels fund, and $27 million in the transit support fund.

2011’s budget dipped slightly from 2010: $767 million from $773 million. The coming year is going to be based upon new property values and the readjustment of the millage rate. Will the Executive propose a tax increase following the reassessment and the revenue neutral rate? It is possible for the County to take 5% more than it would collect in property tax revenue this year, but that has to happen in a separate vote. Going higher requires the permission of the courts.

Beyond that, the 2013 budget will be the first to receive money from the impact fee on horizontal drilling for natural gas. According to our estimates and those from the state the County is expected to receive $79,000 from drilling, and about $1 million set aside from the "legacy fund". The use of those revenue is spelled out in Act 13, with legacy fund dollars specifically tied to environmental purposes.

The Next Reassessment

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The County is putting the final touches on the reassessment of real property, the first one in a few years. It will go into effect on January 1, 2013, and the County, its municipalities, and its school districts will have to adjust their millage rates to adjust to the new values. That is all yet to come, but the question of "when do we do this again" has already come up.

Sounds a lot like Allegheny County, doesn’t it? It is not. In fact, it is the county tucked up in the far northwest corner of PA, Erie County. After spending many years not reassessing, the County lost a court battle and reassessed in 2003. After doing that one, Erie’s County Council passed an ordinance in 2005 that mandated reassessments every eight years, giving way to the one set to go into effect in seven months. That time frame is still longer that what the IAAO would recommend as best practices.

If 2005 rings a bell, it should. That was the year Allegheny County released new assessed values that were to go into effect in 2006. That would then lead to annual assessments after another three year breather. That was all scrapped and the base year plan was hatched. We have for several years been pondering what comes next for Allegheny County’s reassessments.

Of course, Erie’s question-and Allegheny’s, and all other counties’-could be answered if the General Assembly comes up with a mandatory schedule for assessments, crafts a statistical trigger, or eliminates property taxes altogether.

Missing the Housing Boom

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Conventional thinking among local leaders is that because the area didn’t “boom” during   the last few years, it didn’t suffer the economic “bust” to the degree some other areas around the country have felt.  Most seem to view this as positive. From a short term perspective that might be true but over the long term the picture is not so rosy.  During the early months of the current recession the Pittsburgh area received substantial national publicity for being the economy that did not “bust”. But missing from these stories is how the region has lagged so far behind the national economy for two decades. One very important indicator of that slower growth is the number of building permits being issued for single family dwellings.

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County Going Green, Needs Green

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In the popular manner of the new paradigm, Allegheny County has just adopted a Sustainability Policy. The new law will focus on energy savings, reduced emissions and water conservation in the County government. Nothing wrong with that if implementing actions to save does not cost more than the projects save taxpayers.

But if the County is truly concerned about the environment and "green house" emissions why does it spend so much time and effort promoting job growth, trying to get more air service at the airport, etc. More economic activity means more travel by car and plane. Think of ongoing and recent initiatives. The Penguins new arena, the casino on the North Shore, fairly new stadiums for the Steelers and Pirates-all are efforts to attract people to the County and City. More event attendees, more car travel, and more emissions.

The County government steps to lower its pollution footprint will produce a drop in the bucket compared to the footprint created by the past and current "development" efforts.

There is one thing the "green" efforts have going for them. The huge decline in manufacturing in the City and County has largely taken care of the "emissions" problem already. Now, if we could do something about those annoying cars.

And, lest we forget, the County’s fiscal situation is not very good and is expected to get worse in coming years. Thus, we hear proposals about new taxes and fees on hospitals to generate more "green" for county coffers. Collecting more tax dollars is very difficult to do unless the economy is expanding, and that means more energy consumption, more emissions. What a dilemma the County faces. It needs green and wants to be "green". It’s not easy as the famous Muppet, Kermit, used to sing.

Lingering Problems at Pittsburgh International

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The Allegheny County Airport Authority has released its budget for 2010.  And while it contains a very slight increase in expenditures over this year’s budget it has been necessary to boost airline charges to cover expenditures and to reverse a decline in revenues. These higher costs will ultimately be passed along to passengers or lead to lower profits for the airlines.

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