“If we continue to operate as we have over the past several years, Allegheny County will soon suffer a financial crisis”—press release from County Controller, April 15, 2009
The practices referenced by the Controller include relying on one time revenues such as money that came from the state’s disbursement of gaming funds and borrowing from the capital budget to cover operations. Sounds like the SOP of the City in the 1990s. The Controller predicts a $50 million deficit in a few years. The only problem is that counties are not eligible for Act 47 status.
But the Administration is not worried. The Executive’s spokesman noted that the County would have “a few years when finances would be tight until we get some other revenue sources.” Consider that the County has created three new revenue sources since 1994: the 1% sales tax (of which the County itself gets around $35-40 million annually for general operations), the drink tax, and the car rental tax, the later two used to move the responsibility of funding mass transit from property taxes. Next in line are the host fees from the opening of the casino. Obviously the County’s spending keeps outstripping its revenues.
Consider the County’s total revenues and total expenditures across all governmental funds along with the County’s population. In 2003, on a per capita basis, the County’s revenues were $1,014 and expenditures were $1,069, meaning the County spent $55 more per person than it had in revenues. In 2007, per person revenues were $1,239 and expenditures were $1,275, meaning the gap had shrunk by about $20 per person to $36. Various other financing uses (transfers, proceeds of refunding general obligation bonds, etc.) have closed the gap in each year.
Here’s another quote from the Controller: “There are some tough choices to be made and we need to start making them”. Perhaps that means a much harder look at the general operations of the County, and how much it is spending on a per capita basis. Certainly a hard look will have to include the massive health and human services component funded by state and Federal dollars. Maybe the County will look to the Federal government for help on this function. Then taxpayers in other states can participate in assisting Allegheny County government.
