State oversight authority demands update on Pittsburgh's financial management system

| Monday, June 17, 2013, 12:01 a.m.

One of Pittsburgh's state oversight boards is demanding that city officials explain this week why they haven't implemented a financial management system that was supposed to be in place by the end of last year.

The Intergovernmental Cooperation Authority said the city has not answered such requests for months.

Chuck Half, project manager for the city's financial system, said it is complying with a timetable for installation the ICA agreed to in March. However, he said, some parts of the system won't be operational until at least the end of the year.

ICA board Chairman Dana A. Yealy demanded in a letter to city finance Director Scott Kunka that it get a written accounting by the end of business Monday as to how much remains of $7.5 million earmarked to pay for the system. It wants assurances the city won't spend money unless the ICA approves.

Yealy could not be reached.

The ICA demanded that city officials attend the authority's 4:30 p.m. meeting Wednesday in City Council chambers and threatened sanctions if they don't provide answers. Sanctions could include revoking approval of the city budget and withholding state aid.

ICA Executive Director Henry Sciortino said on Friday that officials asked to discuss the issues instead of writing a letter. That meeting has not been scheduled.

“They asked that we sit down and talk. That's an important thing,” Sciortino said. “It's always a good start.”

It's the latest tension between City Hall and the authority, which the state established in 2004 to monitor spending and approve budgets when Pittsburgh was declared financially distressed under Act 47.

Outgoing Mayor Luke Ravenstahl says the city no longer needs oversight from the ICA or an Act 47 team. City Councilman Bill Peduto, the Democratic mayoral nominee for the November election, said he wants the oversight to remain, as the city faces issues with pensions, debts, operating deficits and the modernization of operations.

“The ICA board and executive director are an oversight body, not subject-matter experts on purchasing or implementing (financial reporting) systems,” Half wrote in an email to the Tribune-Review. “The mayor's office continues to work with proven best-in-class departmentally focused modules to ensure that a technically efficient, coordinated, maintainable, upgradable, and financially accurate comprehensive financial management system can optimize Pittsburgh's unique day-to-day operations for the 21st century.”

The ICA required the city to buy software that would help track employee costs, work assignments and budget costs, and have that system tied into Allegheny County's financial management system by the end of 2012.

The ICA set an April 26 deadline for a written update. Since then, the two sides have traded letters.

Half said the city on Thursday issued a request for bids for budgeting and forecasting software. It won't ask vendors for proposals for other components of the system until late this year, he said.

Peduto called the delays “a lost opportunity to be saving taxpayers millions of dollars.”

Pittsburgh has a projected deficit for 2014 through 2018 because an agreement in which nonprofits would give the city $2.6 million a year in lieu of paying taxes has been terminated.

Yet in a May 29 letter, Kunka told Yealy that annual payments of $3.2 million would continue.

Yealy responded that the city has to prove that on Wednesday.

Bill Vidonic is a staff writer for Trib Total Media. He can be reached at 412-380-5621 or

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