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Jeannette to consider changing way city has been governed for 125 years

| Tuesday, March 12, 2013, 12:01 a.m.

Jeannette council will consider changing the way the city has been governed for the past 125 years.

Council listened to options on Monday from a state official that would allow the city to adopt a home rule charter or an optional form of government that would drastically change the way the city has operated since its founding in 1888.

Mike Foreman, a local government specialist with the state Department of Community and Economic Development, offered a series of proposals to improve the city's financial situation. One is to adopt home rule, which would allow the city to raise taxes beyond the limits now imposed by the Third Class City Code.

Council will decide whether to create a home rule study commission whose elected members would consider operational changes or recommend the city keep its current form of government. If council rejects the proposal, the process could be triggered by the public presenting a petition to council that also would put the question on the ballot, Foreman said.

If a commission is created, it would have nine months to study the problem and, if it recommends changes, another nine months to draft a home rule charter. The question could be on the ballot as early as November, Foreman said.

Among the options are:

• A council-manager form of government in which the supreme power would rest with a professional city manager who would oversee all city operations. Council would not be involved in the day-to-day operations of the city and would become a policy-making body.

• A mayor-council system in which most power would rest with the mayor subject to council oversight.

• Keep the current form of government consisting of a voting mayor and five council members.

Foreman said a major advantage to home rule is the city could raise property, earned income and deed transfer taxes beyond its state-mandated cap, thereby increasing revenue. Under the Third Class City Code, Jeannette must seek court permission before it can increase taxes to offset budget deficits.

Jeannette has been teetering on the brink of municipal bankruptcy and could be declared a distressed municipality that would put it under state control. Foreman has been working with the city to avoid that designation and made the recommendations to increase the city's revenue so it gets back on sound financial footing.

He also proposed the city refinance a $2.9 million bond issue earmarked for a flood control project and use the savings to help pay its pension debt. Foreman also recommended increasing the city's earned income tax rate and its business privilege taxes and put that revenue toward its annual pension obligations for its police, fire and city employees.

The city owes $350,000 for last year's pension contribution known as a minimum municipal obligation and will pay $546,000 this year.

He recommended the city sell its debt to a third party who would be responsible for collecting the unpaid revenue. Jeannette is owed about $1.5 million in unpaid real estate taxes and $260,000 in delinquent garbage fees, according to city and county tax records.

“You want a full court press on delinquencies,” he said.

Foreman also proposed conducting a staffing study to “right-size your organization” to determine if city departments are over- or understaffed.

Richard Gazarik is a staff writer for Trib Total Media. He can be reached at 724-830-6292 or at rgazarik@tribweb.com.

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