Thursday, March 27, 2008

A date fast approaching ...

So I have started to mention this April 8th hearing with the State’s Economic Development people, a hearing to see if the city can get out of Act 47 status. I have only seen mention of it in one or two places, and the only one I can remember is about the Firefighters trying to get contract negotiations going out ahead of it. I assume, but don’t know for sure, that Dennis Yablonsky will be at the April 8 hearing, like I assume that the Mayor and Council President will be there. Past that I know little, and can’t find mention of it on the State Economic Development website.

So what I hope would happen then and there is that the State’s people would note that the City has not addressed it’s debt and pension problems, and the Mayor’s own budget projections show us in deficit in a few years. The State would propose a new five year plan, with some State money for pensions and debts, and perhaps higher taxes in the city and also the county. Or one of the new Council persons would stand up and ask for that. Or something.

What I fear that what will happen is that, as a reward for the Mayor's pledging for Hillary Clinton, Dennis Yablonsky will find that the City has made sufficient progress and our Act 47 status should be rescinded. If so, we had better hope the next President is a Demoocrat, perhaps we had better hope it is Hillary Clinton. Maybe then the City will get some block grants, although who knows if it would be enough to keep up with the public safety union’s pillaging of the City’s coffers, not to mention the no bid sweetheart deals that will become the norm.


M said...

When the proposal was first floated, I wrote my state rep and senator urging them to keep Pittsburgh in Act 47. I found their responses reassuring.

EdHeath said...

Well, while it is heartening to have the reassurances of local state level legislators, I believe the Secretary of the Department of Community and Economic Development or the Governor can rescind our Act 47 status by themselves. And I believe it is at least possible that was the price for the Mayor’s endorsement of Hillary Clinton.

M said...

Your comment made me re-read their replies. One of them was very firm, but the other left plenty of wiggle room. Still, could Luke's endorsement be worth enough to justify the cost?

EdHeath said...

Yeah, I still don't think the legislature would be involved in rescinding Act 47. I will say Pittsburgh is so large they may get themselves involved, if enough of them care.

I doubt Our Mayor sees getting out of Act 47 as a cost. I think he sees it as a benefit, where he can cement the public safety union voting blcok for years or decades to come. I honestly think Our Mayor's time horizan is that limited, that he doesn't care about three years from now when the city will start to run out of money again. Maybe Fast Eddie promised him something else, who knows. But I think it is possible that Our Mayor's endorsement of Hillary Clinton was a trade for a signature getting us out of Act 47. I think that, and I hope I'm wrong.

M said...

I wasn't clear. You don't need to convince me as to why Luke wants out of Act 47. We are in complete agreement on that. I'm just more hopeful that the governor and state officials better able to calculate the costs and benefits.

For the benefits, you have whatever Clinton promised Rendell (admittedly unknowable for me), but multiplied by the probability that she wins (certainly, by the time Luke endorsed anybody with a pulse would know that this is well below .50) and multiplied by the probability that Luke can deliver whatever Rendell wants in the way of extra votes for Clinton.

On the cost side, I'm thinking that:
A) Ending Act 47 is essentially the same as letting the mayor control the budget.

B) Letting the mayor control the budget is the same thing as re-bankrupting the city (except even worse than the first time because the city will have fewer taxpayers and an even bigger pension shortfall).

C) This would impose real political costs on whoever is governor at the time because the choice will be between spending hundreds of millions or letting the 2nd largest city in the state essentially die.

I think we agree on A and B. C is admittedly the weak point in my argument, especially if Rendell wants a position in the cabinet instead of another term or a Senate seat. Also, I'm thinking that when Rendell and Luke sit down to negotiate, Rendell is getting the better end of the deal.

If I'm wrong, don't blame me. I voted for Swann and DeSantis.

EdHeath said...

Well, I am cynical enough to say that the Governor may not care about the cost of allowing Pittsburgh to exit Act 47. I believe the Governor is term limited, so if he does not get a cabinet post he may go be the president of some college or university. I doubt Luke will deliver many votes (though he certainly had the votes of African Americans in the recent election). But he also has his status as a super delegate. Senator Clinton may have asked the Governor to deliver as many super delegates as possible.

I don’t think that the Mayor would be in total control of the budget. But I do think City Council will go back to their old, pandering ways, at least a majority of them. Even the new Council members will eventually need to deliver something to reliable voting blocks of their districts (which often include public employees). And there is a good chance that the public safety unions will use binding arbitration to exact new money from the City, regardless of the Mayor’s or Council’s good or bad intentions.

I’m not sure of the political cost to Ed Rendell. He will be gone soon, and anyway he can point to balanced budgets and surpluses in Pittsburgh as his justification for taking us out of Act 47. The next Governor may have pressure on him to act, but a hostile State Legislature could try to thwart him or her.

I think the Governor and the Legislature might be inclined to help us, even if only a little, *if* the City’s elected officials asked for the help and took responsibility for our problems (giving the Governor and the Legislature some political cover with their constituencies). But I think Ravenstahl and Shields (and Motznik, Deasy, Harris and Payne) will assert that the City is in fine shape. Maybe one of the newcomers will speak up, but I won’t hold my breath.