Act 47 Team: Pittsburgh “Completed” 64% of Initiatives

If an exam with 132 questions was administered at any of the schools in western Pennsylvania and the student correctly answered 85 of those questions, the resulting percentage would be a 64%. On most grading scales that would be a "D": if the student was previously and "F" student, then there is progress.

Unless dealing with bond ratings, letter grades are rarely handed out to cities and towns. As Pittsburgh waits to hear if the state will release it from Act 47 distressed status, the team charged with recovery (in place since 2004) published its rescission report that shows what Pittsburgh has accomplished: debt levels are down, there is labor peace, a trust fund has been established for retiree health care liabilities, there is a financial management system in place, and the City has pledged a revenue stream to deal with pensions. Just as those successes are heralded by the coordinators, they also express "continuing concerns" on most of those big ticket items: dealing with escalating benefit costs, funding capital needs, and executing collective bargaining agreements in the future. Unlike 2007, when the City petitioned to get out of Act 47, the recovery coordinators are now in favor of rescission.

The team shows 132 initiatives that have come from the recovery plans and funnels them into one of four categories:

  • Completed: Action has been achieved or achieved to date and may require a recurring action to remain complete. (85 or 64% of initiatives)
  • In progress: Demonstrable progress made to achieve completion, but the action is not complete or it may require a long term effort. (38 or 29% of initiatives)
  • Not applicable: Opportunity has passed or it is out of the City’s control. (9 or 7% of initiatives)
  • Incomplete: No demonstrable progress has been made. (0)

Obviously there is a lot of leeway in this typology, even realizing that if DCED would accept the status of each initiative as gospel only 64% of them are actually done to the point of completion (or how something that is "completed" would require "recurring action"). If DCED looks at the initiatives "completed" or "in progress" as "good" then the City has made positive strides on 93% of the work.

But there are some head scratchers for sure. The Act 47 team considers the City’s establishment of a debt policy "completed"; whether the City sticks to it is another matter altogether, hence the recurring or further action. Same holds for the three decades long promise of money to the pension fund. Does anyone believe that "[pursuit] of City-County consolidation of departments" is "in progress"? Or that the City is not "incomplete" on any of the initiatives?

In order to have distressed status removed, a municipality has to have a positive operating fund balance for at least one year, have eliminated accrued deficits, retired obligations that were taken on to eliminate the deficit, and get the recommendation of the coordinator. Pittsburgh has satisfied the first two, never had the third, and has the fourth. It also has the situation where even if Act 47 goes away the oversight board stays in place.