Pittsburgh’s tax crusade is being met with predictable resistance from one of our daily papers.
Those living outside Pittsburgh’s borders but working within them now pay $52 annually. If Democrats who drove the city into state receivership — the government equivalent of Chapter 11 bankruptcy reorganization — can’t get their act together, the Act 47 “recovery” team reportedly would consider raising the annual tax to $145.
If that molestation isn’t bad enough… (Trib, Edit Board)
A tax increase of roughly $7.75 a month — levied on neighbors who choose to work in the City and no doubt spend a good deal of their leisure time consuming its services — is enough to prompt our friends at the Trib to reach for their rape whistles.
This is to say nothing of their sudden rancor against delicately tapping our burgeoning non-profit sector for the first time — an option for which I could have sworn they had sounded moderate approval in the past.
More troubling, however, is that even talking about such nonsense once again exposes the fundamental lack of economics smarts by Pittsburgh’s financial overseers. Raising taxes in recessionary times is like whooping it up over that light at the end of the tunnel but fully knowing it is an oncoming train. (ibid)
Ah, that old chestnut — I always tire of it. One day somebody must show me, in a textbook or a history book, on a chalkboard or in a laboratory, how it came to be maintained by such a motley handful that raising any form of tax under any conceivable set of circumstances during a recession — even one that is nicely receding — always leads to misery and woe. Because I do not believe such evidence exists anywhere.
Sometimes a city needs liquidity in order to ward off an existential threat. Sometimes constituencies are identified which are not contributing a genuinely equitable or sustainable share compared to what they reap in return. Sometimes a region has to pull together.
The mayor’s plan to keep the parking tax at 37.5 percent instead of making a state-mandated cut to 35 percent would keep some $3 million a year in the city’s hands. A hike in the $52 tax on those who work in the city, to $145, could bring in $23 million — two-thirds from suburbanites, the rest from city residents. And extending the 0.55 percent tax on business payrolls to tax-exempts like hospitals and universities could net $16.5 million.
Even if new revenue ends up being $30 million, that “allows us to obviously be sustainable on the operating side of things for years to come, but also allows us to begin to deal with pension [shortfalls] and debt, something that we’ve talked about for a long time but don’t have the resources locally to make any significant impact,” Mr. Ravenstahl said. (P-G, Rich Lord)
A) Good plan, or should I say good opening volley.
B) I feel like a bit of this was a temporary relapse into electoral-season braggadocio. A month ago there was every practical reason for the Mayor to speak always in terms of the absoluteness of Pittsburgh’s near-certain checkmate over the forces of financial entropy — but this is an entirely different situation.
If the Council’s Finance Chair is to be trusted, it sounds like we really need $80 million annually to be sustainable. If the blogosphere’s financial guru is to be trusted, even that may be optimistic. Either way, these taxes would not get us halfway to that position of genuine security.
What I’m saying is, sounding desperately in peril can only help Pittsburgh in this situation. If we continue broadcasting that “$30 million will totally get us out of the woods,” folks will be inclined to meet us only halfway or less. Whereas if we tell them, “Iceberg, dead ahead! This is the very least you can do and we need every last penny and even that’s just to get going!”, they may be more inclined to give us something more like what we truly require.
C) It sounds from the above and from a KDKA/PG interview that Mayor Ravenstahl has already negotiated away half of the proposed payroll tax on non-profits. I hope that was the right move, I do not know the situation behind closed doors — but this seemed like the one facet of the plan of which we were in relative control. Maybe we can regain it.
D) Most importantly, perhaps — though the steps above are good and necessary — they will be a tough sell to our neighbors, to the state legislature, and apparently to ourselves without demonstrated reciprocal sacrifice on the home front. That is, our crusade is as yet a military campaign with only one pincer. As such it will be easily blunted.
I hesitate to bring up Ravenstahl’s close ally Bill Peduto again, but it just so happened that his manifesto for netting $80 million instead of a mere $30 million included several elements having nothing whatsoever to do with taxes — and I’ll bring up one now.
5. Baseline audits / Professional management / Outcome-based performance (Pgh Comet)
Since belt-tightening will no doubt be self-righteously demanded by our neighbors, and since further belt-tightening is actually quite impossible, it might be advisable instead to er — to put on some pants.
We know that potholes and roadwork are issues that carry a lot of cache especially lately, and consume a fair chunk of our city’s resources to boot. We know that some years ago, Public Works foremen made rounds personally every morning with a clipboard to evaluate complaint reports and then rationally plot out a strategy for the day or week, with the aid of some work orders from higher ups in the Department. We know that in recent years, those duties have shifted to well-meaning but completely untrained community guys and committee guys like our colleague Matt H in a sub-rosa fashion. We should be able to infer that we’re not conducting this high-profile function nearly as efficiently as we might be — and we should anticipate that with the “professionalization” of our service delivery (together with a little PR mojo) we could duly impress some of those same folks who now think of contributing to the City as throwing money into a white-hot furnace. If we’re going on a crusade, we should do our very best to act noble — or else we just look like marauders.
Now, there are those of course who are resolved to believing that Pittsburgh is in fact a clownish lost cause that ought to be “cut loose” or “severed” or “be merged out of existence and disenfranchised” or “left to its own devices” by the rest of the region. I think those folks are confusing cathartic emotionalism with hard-headed realism but I’m sure we’ll continue to engage them.