NEW CASTLE — The city faces the prospect of state sanctions, including suspension of funds and possible receivership, for failing to comply with a three-year exit plan to exit Act 47 economically distressed municipality status and restore the city’s financial health.
Possible sanctions for non-compliance also include restricting the city’s taxing authority.
The city sought Act 47 status in 2007 and adopted a three-year exit plan in 2019. State regulations require economically distressed municipalities to adopt three-year plans for recovery.
Farrell was the first community in Pennsylvania to file for Act 47 status, with its action in 1987. The city exited Act 47 in February of 2019, leaving Greenville as the only Mercer County municipality to be in economic distress. Greenville adopted an exit plan in 2019.
“We sent a letter to the mayor and city council yesterday (Wednesday) regarding how the city’s lack of code enforcement activity this year results in non-compliance with the exit plan,” said Vieen Leung, one of the city’s Act 47 coordinators. “We provided concrete next steps in the letter in order to bring the code enforcement operations into compliance, and will follow-up with the city regarding its progress.”
The exit plan, adopted by city council in August 2019, outlines steps to end the city’s financially distressed status, under the state’s Municipalities Financial Recovery Act. Leung listed violations in rental inspections, occupancy permits and inspections, demolitions, and technology upgrades in code enforcement vehicles.
The state’s letter to the city outlines several violations, including:
• A third-party vendor who administers rental inspections completed only eight inspections within the first two quarters of 2020, compared to 566 completed in the first two quarters of 2019. The letter notes the city outsourced the duties in March 2019.
• The city has not enacted an ordinance that requires new owners to correct violations prior to occupancy.
• The city used a $46,000 state-funded grant to purchase software and field equipment for its code enforcement vehicles but has yet to start using the technology. Code also wrote zero citations in the second quarter this year, compared to 317 citations written in the second quarter in 2019.
The letter also noted council members voiced concern during an Aug. 25 meeting about the number of demolitions planned for the rest of this year.
To become compliant, the city must take steps to comply with four areas dealing with how it handles code enforcement.
Those steps include ensuring a third-party provider conducts rental inspections by Oct. 1, enacting an ordinance requiring occupancy permits for a change in ownership by Oct. 31, reporting the number of demolitions per month to the recovery team, and installing new software and equipment.
“Do we have steps to get us back in (compliance)?” Councilman Bryan Cameron asked Mayor Chris Frye during city council’s meeting Thursday.
Frye called the letter “a formality to follow up and make sure things are getting done.
“It’s not like we’re getting hit with a hammer. It’s a formality to keep us on track.”
Bryan acknowledged, however, receivership was possible with ongoing non-compliance.
“I don’t think this is something we should take lightly,” he said.
Councilwoman MaryAnne Gavrile couldn’t recall the city receiving any other non-compliance letters since entering Act 47.
Council President Tom Smith called the letter “distressful.”
“A lot of issues are stemming around code enforcement,” he said. “Code enforcement is critical to the City of New Castle being revitalized ...”
“I think we have serious issues in that department.”