ICA warns Pittsburgh over potential budget deficit
Pittsburgh could lose state funding if it fails to meet the deadline Friday to address a potential budget deficit and update its financial management system.
The city must respond in writing to the Intergovernmental Cooperation Authority's query on the issues by day's end, according to Henry Sciortino, executive director of the city's state-appointed financial overseer. Possible sanctions include revoking approval of the budget and withholding millions of dollars in state aid. Pittsburgh budgeted $13 million alone this year in anticipated Community Development Block Grants. A complete total of state funding was not available.
“Practically speaking, any revenue they would be getting from the state, they would not get,” he said.
Mayor Luke Ravenstahl, speaking publicly on Thursday for the first time since March 20, said the ICA's stance surprised him and that he disagrees with the agency's contention.
“We have complied and will continue to comply with their (requests),” he said.
The state Legislature in 2004 appointed the ICA to help resolve Pittsburgh's financial problems. Pittsburgh must submit annual budgets and five-year financial forecasts to the ICA for approval.
Pittsburgh has a deficit for 2014 through 2018 because of the termination of an agreement under which the nonprofit community gave the city $2.6 million this year in lieu of paying taxes.
Financial planners must find new revenue to make up for that loss, or cut expenses, Sciortino said. Controller Michael Lamb, however, disagreed, saying the city shouldn't assume that money will disappear.
“I think it would be irresponsible to not anticipate some agreements from the nonprofits,” Lamb said.
The ICA wanted the city to develop a task force consisting of city, community and labor leaders to work out a new agreement. However, Regional Industrial Development Corp. President Donald Smith, who chairs the task force, asked the ICA to put the task force on hold. Smith cited a coming change in city administration with Ravenstahl leaving office, pending legislation in Harrisburg that could affect the legal status of nonprofits and Pittsburgh's legal challenge of UPMC's nonprofit status.
Sciortino said the ICA wouldn't quibble over the task force.
“We don't care how they solve this budget issue. We want an answer as to how they're going to fill that budget gap.”
Despite the mayor's insistence the city has complied with the ICA's demands, the agency said the city failed to buy software to help it track employee costs, work assignments and budget forecasting. Lamb said the city has not purchased the software.
Last year, the ICA released $10.2 million in gambling taxes it withheld from the city in lieu of a plan for using the money. The ICA required Pittsburgh to use part of the cash to buy the software by Dec. 31, 2012.
“There's no reason why they shouldn't have this,” Sciortino said.
Finance Director Scott Kunka said the city is almost ready to begin soliciting bids for the software.
Bob Bauder is a staff writer for Trib Total Media. He can be reached at 412-765-2312 or firstname.lastname@example.org.
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- Faithful stand together in Wilkinsburg
- More departments in region eye equipping officers with Narcan to treat overdoses
- Burial set for remains of World War II soldier from city
- New Monroeville Mall policy aims to tame teen shoppers
- Region tied 81-year-old record low Saturday
- McCandless mortgage broker company president charged with bank fraud conspiracy
- 3-alarm fire burns Hill District row homes
- Black Pittsburghers still challenged in education, workforce, housing
- Pittsburgh police chief: Officers, public must unite against violence
- Port Authority focusing on natural-gas bus fleet for proposed rapid transit line
- Newsmaker: Dai Morgan