Southwestern Pennsylvania municipalities are operating with budget deficits at an alarming rate, according to a new University of Pittsburgh study.

George Dougherty, a professor in the Graduate School of Public and International Affairs, directed the study in cooperation with the Pittsburgh Regional Indicator project and released his initial findings Wednesday.

He found that 80.2 percent of 509 cities, boroughs and towns in the region had a budget deficit at least once from 2000 to '05. A total of 58.5 percent had at least two deficits, which is a common indicator of fiscal distress, and 48.9 percent saw overall expenditures grow faster than revenues in that span.

The survey examined municipalities in Allegheny, Armstrong, Beaver, Butler, Fayette, Greene, Indiana, Lawrence, Washington and Westmoreland counties, excluding 44 local governments for which data were unavailable.

"We hear a lot about specific municipalities that are having financial problems, but I didn't expect to find nearly as many," Dr. Dougherty said. "The problem was much bigger than I expected."

Suggested solutions tend to fall into two categories -- small localities should band together to provide more efficient services, and leaders should be more willing to take unpopular stances, including raising taxes.

Kevin Ortiz, spokesman for the state's Department of Community and Economic Development, said his office is pushing legislation that would consolidate collection of the earned income tax to the county level, which would save nearly $81 million in the 10 counties included in the study, according to Pennsylvania Economy League estimates.

The state provides assistance to struggling communities through a variety of other initiatives, including the Municipal Financial Recovery Act -- known as Act 47 -- which provides supervision and funding to help municipalities get their finances in order. Five Allegheny County municipalities, including the city of Pittsburgh, are currently aided by the program.

Allegheny County and the state have pushed for smaller boroughs and townships to combine their police and fire services, making them more efficient. Kevin Evanto, spokesman for County Chief Executive Dan Onorato, cited new consolidated police departments in the northern region and Ohio Valley as examples.

Also, when Mr. Onorato merged the county's five 911 centers into one, it saved municipalities $3 million, Mr. Evanto said.

"We're always willing to sit down with municipalities and talk to them about what we can do or how we can potentially provide services," Mr. Evanto said.

To provide more incentive, Mr. Evanto said, the county has agreed to provide capital funding to build centrally located police or fire headquarters for any municipalities that combine services.

But localities also must take responsibility, Dr. Dougherty said, to increase taxes even when it's politically unpopular -- and their citizens need to recognize how essential that is.

"When governments start acting more like businesses, which means raising prices to cover costs of providing services, people go ballistic," said Dr. Dougherty, who mentioned the Allegheny County drink tax uproar as an example.

"In many cases elected officials are not willing to take the flak that comes with those decisions."

The municipalities with the most deficits in the study were not always ones most commonly associated with financial trouble. Braddock, which receives Act 47 assistance, did not run a deficit in those six years, while Fox Chapel -- with a 1999 median household income of more than $147,000, about eight times that of Braddock -- had deficits four times in that span.

Some of those numbers might be skewed, Dr. Dougherty said, because his calculations disregarded the "other revenues" and "other expenses" categories, which usually refer to one-time projects. Leaving them out helped get a more consistent picture of a municipality's finances over time, but it penalized municipalities that brought in lots of investment.

When the "other" categories were included, affluent Mt. Lebanon ran only two deficits, as opposed to six, Dr. Dougherty said, but there were more communities that had two or more deficits.

The findings released this week -- which can be found at www.pittsburghtoday.org -- are the beginning of a more comprehensive look at local government budgets that will include parts of Ohio and West Virginia in the Pittsburgh region and compile more national data to serve as a comparison.

The goal is to help prod local governments into more responsible fiscal management -- a small, yearly surplus that can be used for a rainy day fund.

"If you read any finance magazine or if you watch some of the finance shows on television, they always say Americans need to save more," Dr. Dougherty said.

"Municipalities need to be run that way as well."