Pension reprieve: The city keeps control, but there is still much to do
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It took hard negotiations and persistence, but the immediate threat of a state takeover of Pittsburgh's wobbly pension fund was averted Monday, no thanks to Mayor Luke Ravenstahl.
City Controller Michael Lamb, council President Darlene Harris and members Bruce Kraus, Patrick Dowd, Bill Peduto, Natalia Rudiak and Doug Shields deserve the gratitude of city taxpayers for the 11th-hour remedy they devised on New Year's Eve. If the state had seized the pension fund, it would have triggered a property tax hike to pay for the additional pension contributions.
Instead, council's plan promises to send $735 million in parking tax revenue into the pension fund over the next 31 years. The state's Public Employee Retirement Commission gave its OK to the plan, determining that the city's pension holdings exceeded the necessary level of 50 percent funded and, in fact, was at 62 percent as of Dec. 31.
Now the city must make sure it follows through to replace the revenue that will be going into pensions instead of into the city's general fund. To come up with those dollars, council raised parking meter rates and increased the enforcement hours. Trouble is, the Pittsburgh Parking Authority has refused to sign a new deal to turn over that extra revenue, and council doesn't have the power to force the change.
Mr. Ravenstahl does, because the authority's members serve at his discretion. He fought council's pension-saving plan because he favored a long-term lease for private operation of city parking facilities. Even after council rejected his idea, the mayor kept pushing for it. Now, his finance director says the mayor won't necessarily have to use parking funds to fill the budget gap created by the pension rescue, although that hole is $1.3 million today and explodes to $9.3 million next year.
That's a lot of money to be found elsewhere in a no-tax-increase city budget and, even if the mayor can do so, the question remains: Why not use the increased meter rates to solve some of the city's financial problems?
Council already has backpedaled on one element of the parking plan, by temporarily rolling back the evening cutoff for enforcing parking meters to 6 p.m. Tinkering too much with a plan that has saved the city from a crisis could trigger even more trouble ahead.
Preventing that is up to Mayor Ravenstahl.
First Published September 22, 2011 12:00 am