Archive for November, 2011

Debt Management Ordinance

Tuesday, November 15th, 2011

Posted by Bill Peduto

rpn-debt-management-ordinancePittsburgh’s checkered past when it comes to debt is well-known to many of you who remember the Act 47 takeover by the state and the fight over the Ravenstahl Administration’s attempt to privatize our parking assets. We have finally been able to wrangle control of our debt and the outlook is, while still not perfect, better than it has been in many years. Debt is not necessarily a bad thing for a City that wants to invest for its future and lay the groundwork for long-term growth, but it is a tool that must be used carefully and sparingly. Since the Act 47 takeover, the state oversight body has asked the City to implement a debt management policy to ensure that decisions made regarding the issuance of debt are not made lightly and that there are clear policies that must be followed. This month, I introduced a strong, clear debt management policy today that will achieve these goals.
 
My Debt Management Policy pulls together recommendations from the Government Finance Officers Association (GFOA), an international body of experts in municipal finance, as well as best practices from other cities to put in place clear boundaries for how and under what circumstances the City can take on more debt. We must be sure that debt is only being used to fund long-term projects that will benefit the entire City and that these investments will pay off in the future. The legislation will also allow the Council to bring in an independent financial advisor to provide an assessment of any potential debt deal and make the findings public.
 
With this legislation in place not only will one of the unmet conditions of our Act 47 plan finally be met, but the citizens of Pittsburgh will know that important financial decisions are being made with a clear policy in place and that they are being made free from the influence of politics.

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Pittsburgh Stimulus Program

Tuesday, November 15th, 2011

Posted by Bill Peduto

rpn-pittsburgh-stimulus-programThough the worst of the Great Recession is over and the United States economy is beginning to grow again, people who were put out of work or saw their hours cut when the economy collapsed have not fully recovered. Unemployment and underemployment are still too high, corporations and banks are holding cash instead of making loans, and development projects have stalled throughout the country. The prospect of help from Congress looks dim as the 2012 Presidential race kicks into gear so Pittsburgh City Council must step up and do what we can to spur economic growth and get our residents back to work.
 
The Pittsburgh Stimulus Plan, introduced last month, will do just that. The plan provides anyone interested in starting or continuing a residential, industrial, or commercial development 10 years of property tax relief on a graduated scale. In the first two years the tax bill is cut 100%, the next two years it is cut 90%, and so forth until in the final two years, taxes are cut 60% before the plan is phased out. The temporary relief and flexibility provided by this plan will get the shovel in the ground for projects that have not been able to secure full financing. Construction and trade workers who have seen their hours cut and their jobs grow fewer and farther between will get back to work and long-awaited projects will finally break ground.
 
This measure is based off an identical plan that currently applies to residential projects in certain neighborhoods. Under the Pittsburgh Stimulus Plan, all neighborhoods and all projects will benefit. The project also mirrors a program that the County has for suburban communities. This legislation will get people back to work in the City of Pittsburgh, while also fighting the suburban sprawl that has impacted this region for so long.
 
We can’t wait for the Congress to get its act together and provide economic relief to struggling families in Pittsburgh, the time to act is now.

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Responsible Banking Act

Tuesday, November 15th, 2011

Posted by Bill Peduto

rpn-responsible-banking-chartIn 1977, the United States Congress passed the Community Reinvestment Act (CRA) as part of a larger push to end discriminatory practices in mortgage and consumer lending that had led to large portions of, primarily, African American neighborhoods to be redlined. Redlining was the practice of banks and other lending institutions literally drawing a red line around certain neighborhoods and dictating that no loans could be made for residents and business owners there.
 
The CRA effectively ended redlining and led to a renaissance in bank-community relations that lasted several decades. While CRA has been incredibly important, it is federal legislation that doesn’t always capture the unique conditions on the ground in cities and states around the country. It is for this reason that I introduced the Responsible Banking and Neighborhood Reinvestment Act last month.
 
This legislation builds upon the success of the CRA, requiring that any banks holding City of Pittsburgh deposits provide documentation and reports to the City Controller outlining the ways in which they have reinvested public monies into our neighborhoods. The City Controller will then compile a “report card” showing the City Council and the public which banks we’re doing business with are excelling, which are maintaining steady progress, and which are falling behind in their commitments. The City invests tens of millions of dollars in banks each year and that money must be put back to work for our City and its neighborhoods.

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