Peduto: City's Financial Situation Is 'Grim But Solvable'
“It’s not going to be easy.”
That was Pittsburgh Mayor Bill Peduto’s primary message to City Council and the public Tuesday morning, as he shared details of the Steel City’s dire financial situation and challenged his colleagues in city government to help find solutions.
The address coincides with Tuesday night’s public hearing on the city’s financially distressed status, an event organized by Act 47 coordinators.
Peduto said the city is facing an annual structural deficit of $20 million dollars for the next five years. But even if the city found an additional $20 million a year, Peduto said it would still be in trouble.
“Because we’ll never have done anything to fix our pension obligation, and those pension funds will dry up,” Peduto said. “We’ll never be able to pave the streets, or fix the rec centers, or take care of our assets because we don’t have an adequate capital budget.”
Including the city’s unfunded pension obligation and capital needs, Peduto said the deficit jumps to $60 million annually.
Peduto said the financial shortfall is the legacy of inaction and poor management over the last decade or so. For example, he said it’s not an especially harsh winter that’s to blame for the poor condition of city streets.
“It’s because we’ve ignored the problem for a decade, of putting together a management plan to take care of them over the long term,” Peduto said.
The Mayor was reluctant to detail any specific solutions to the city’s fiscal woes, saying that he wanted to hear the Act 47 team’s ideas and, more importantly, he wanted the public to know that their input was welcome and valued.
Peduto said the ultimate plan would represent a complete restructuring of the city budget, and that things would be done “the Pittsburgh way.”
“Pittsburgh is about self-responsibility,” Peduto said. “It’s about addressing issues head on. It’s about showing daylight on the problems that are there, and then finding real solutions to solve them.”
The city is required to present a five-year plan for exiting Act 47 status to the state by the end of June.
“We’ve got the next two months to solve the problems of the last fifty years,” Peduto said. “We’ve got the next two months to create a city … for the next fifty years.”
Tuesday evening's public hearing on the city's Act 47 status begins at 7 p.m. at the William Pitt Union at 3949 Fifth Ave.