Senate Approves Pittsburgh Assistance Plan

 

HARRISBURG -- A comprehensive plan to position the City of Pittsburgh for renewed economic revitalization cleared the Senate and was sent to the House for its concurrence according to state Senators Jane Clare Orie and John Pippy.

 

"We took the basis provided by Act 47 and modified it with the necessary restructuring that will give the City of Pittsburgh the tools to move beyond its current economic situation and work toward restoring it to its proper role as a dynamic force in the Commonwealth," Senator Orie said.

 

Senator Pippy said the proposal was drafted based on months of deliberations and using the input provided by local and business leaders as well as the City of Pittsburgh's oversight board.

 

"There were many excellent suggestions", Senator Pippy said.  "This is a five-year plan, but it is essential that the steps taken during that time provide a solid base for the future.  It was also essential to recognize that this is a regional issue, not just one that affects the City of Pittsburgh and its residents.  Neighboring communities and commuters have a stake in this issue, as does the Airport and the network of businesses in our region."

 

The Senators said the plan calls for a number of interlocking economic actions that generate revenue and reduce Pittsburgh's expenses, which will stabilize the city's budget in the short term and set the stage for it to realize economic growth in the future.

 

"We took a long and hard look at the options and we heard a number of views about who should pay the bill for this effort," Senator Pippy said.  "We wanted to stop the commuter tax and we wanted to prevent bankruptcy, while stabilizing the city's tax structure.  This proposal spreads the benefits and costs.  It's not a panacea, but rather a solid step toward a long-term solution."

 

Senator Orie said the legislators were mindful of the fact that stabilizing the city's economy was essential to preventing the migration of businesses and the resulting loss of jobs, which could worsen the City of Pittsburgh's economic standing.

 

"The key is to solidify the base," Senator Orie said.  "Business leaders are continually looking at the bottom line and whether their host communities can provide the necessary services and infrastructure.  With that in mind, it is essential that we stop the decline in Pittsburgh now and help the city get back on the path to being self-sufficient."

 

The key components of the proposal include:

• Establishment of a new payroll tax -- Rate on Gross Payroll at 0.55 percent;

• Increase the Occupation Tax to $52 a year, with incomes under $12,000 exempt;

• Elimination of the Mercantile Tax;

• A gradual elimination of the Required Business Privilege tax;

• Transfer of the $4 million RAD fund for the Pittsburgh School District back to the city.

• Moderate annual changes in the Earned Income Tax rates for the city and school district;

• Begin reduction of the city Parking Tax from 50 percent to 35 percent;

• An increase in the Public Facility usage fee on visiting athletes and entertainers from 1 percent to 3 percent.