The Herald, Sharon, Pa.

March 28, 2013

Council faces Act 47 debate

Manager preps tough questions

By Tom Davidson
Herald Staff Writer

FARRELL — Farrell council members will be earning their keep in the coming weeks, as they work on a revision to the city’s state-mandated fiscal recovery plan.

“This is what you’re paid the big bucks for,” Dr. Michael Weir told council members Monday.

Weir serves as the state-appointed Act 47 recovery coordinator for Farrell and his comment during Monday’s council meeting was made in light of sometimes heated discussion at recent meetings to raise council pay – a move that ultimately failed.

Council members will earn their $250 monthly check come next month, when a special session is slated for 6:30 p.m. April 9 to discuss a revised Act 47 recovery plan.

Act 47 is the state plan for financially distressed communities. Farrell was the first municipality in the state to enter the program – in 1987 when the law was passed as the Pennsylvania steel industry was turning to rust.

During the April 9 session, council members Kim Doss, Stephanie Sheffield, Annette Morrison, Stephen Bennefield, Robert Burich and Eugene Pacsi and Mayor Olive McKeithan will be tasked with answering some tough questions being posed by City Manager Michael Ceci.

Among them:

ä Would they support an increase in the city’s income tax rate?

ä Would they support a property tax hike?

ä What city services/costs would they consider reducing or eliminating? Would those include making cuts to the fire department, street department, code enforcement, the library, recreation, administration and police?

ä Are they willing to consider discussing contracting with Sharon or Hermitage for police protection if Southwest Mercer County Regional Police Department costs can’t be reigned in? Would they be willing to drop police protection altogether and use state police to respond to emergencies?

ä Do they think Farrell is a viable city or can become one, meaning it can rely upon a consistently increasing tax base to meet the costs of providing services to its residents?

ä Would they be willing to resume discussions with neighboring municipalities about shared services and or a potential municipal merger or consolidation?

How council members collectively answer those questions will affect what kind of recovery plan is adopted, Ceci said.

By adopting a hard line that includes no staffing increases, minimal wage hikes and limited departmental spending, plus gradual wage and property tax hikes, better tax collection and gradual decreases in the nonresident wage tax the city could exit Act 47 in 2018, according to a draft of the plan released by Ceci and compiled with Weir’s help.

“We’ll go over each item,” Ceci told council members. “Adjustments to this plan can be made. No one’s going to force this on you.”

The last time the plan was revised was 2006, Weir said.

Council members will need to decide whether they want to exit the Act 47 program; if not, the state Department of Community and Economic Development likely wouldn’t object, Weir said.

Twenty municipalities, including Greenville, Aliquippa and New Castle, are presently in the program, which allows them to tax nonresidents at a higher rate than the 1 percent allowed for solvent communities.

Only six municipalities have exited the program. They are: Shenandoah in Schuykill County, Ambridge in Beaver County, and Wilkinsburg, East Pittsburgh, North Braddock and Homestead, all in Allegheny County.

The revised plan should be publicly introduced in April and adopted in May.

“Then any budget will be based on this document,” Ceci said. “It will be a guide for everything we do.”