Act 47 was introduced by the Pennsylvania state legislature in 1987 as a means of helping financially distressed cities recover and avoid bankruptcy. 27 years later, several municipalities that were placed under Act 47 oversight have never rebounded.
State Senator Rob Teplitz (D – Dauphin) hopes stronger legislation would help these municipalities have their distressed status removed, while at the same time preventing other municipalities from entering Act 47.
Last week Senator Teplitz held a hearing to discuss legislation to overhaul Act 47. SB 1157 and HB 1773 both would expand the state’s Early Intervention Program and provide municipalities under Act 47 with recovery coordinators and five-year recovery plans.
However, Teplitz said the modifications in the bills are necessary, but do not go far enough to fix the problem.
“We also need to address the broader structural and systemic issues that every municipality in the state faces dealing with,” said Teplitz.
According to Teplitz, local governments are unable to adaquately address the imbalance between revenue and costs. He said fixing this inequality goes beyond simple cost cutting.
Teplitz believes that had the proposed Early Intervention Program been in place, it could have helped cities such as Harrisburg - which filed for bankruptcy in 2011 after accumulating massive debts - avoid Act 47.
“The key is we need to prevent cities from becoming distressed in the first place, not just fix the problem once its occurred," said Teplitz.
Last month Governor Tom Corbett joined Mayor Bill Peduto to announce that Pittsburgh would remain under Act 47 oversight for an indefinite period.
That decision is now being contested by the Pittsburgh Fire Fighter’s Union.
Pittsburgh has been under Act 47 distressed status since 2003. After making considerable economic progress, the former Ravenstahl administration hoped to have the city released, Peduto felt otherwise.
Currently 20 municipalities across Pennsylvania fall under Act 47 oversight.