Wednesday, June 24, 2009

Council Passes Amendments: Political Fantasy or Political Likelihood?

Okay, here is what has happened today Act 47-wise, with the barest minimum of side drama:

Most of an e-mail exchange between Councilman Patrick Dowd and Dean Kaplan of the Act 47 oversight board was read aloud. You know the type by now -- our councillor was requesting some "clarity" on "process".

The response from Kaplan indicated on one hand that "the 2004 Recovery Plan will remain in effect if the Amended Plan is not approved", which would seem to ameliorate our June 30th problem in regards to labor negotiations and arbitration. Good news.

However, it also indicated / reiterated that only the Act 47 Coordinators can amend the proposed Plan, NOT the City of Pittsburgh or City Council, and that they will "strongly consider" petitioning the state Secretary of Community and Economic Development to impose sanctions that would include the withholding of certain funds. Bad news.

Doug Shields was particularly vehement that Kaplan was mistaken about who gets to amend the plan. Write that on a Post-It and stick it somewhere out-of-the-way for now.


On the agenda was a decision whether or not to preliminarily approve the new Act 47 Plan. Remember Council has to lock-in its final answer during Final Action, which for this would be scheduled on Tuesday: the last possible day to get this done under the wire.

Council's Budget Director read into the record a packet comprising 11 pages worth of "amendments" to the Recovery Plan -- amendments which Council is not literally empowered to enact, but which represent requests of our Act 47 overseers to amend their plan in such a way.

Finance Chair Bill Peduto asserted that during a telephone conversation of yesterday evening, the overseers informally agreed to the unobjectionability of roughly 80 to 85% of these sought-after amendments.

These included things such as a facilities management plan, the institution of best practices in budget presentation, regulation of the city vehicle fleet, the inclusion of a professional risk manager, changes in how Animal Control stores its data as well as training for humane officers, and functional consolidations. All this and regular status reports to City Council on implementation of the Plan's recommendations. To this blogger, it all sounded like enforcing aspects of executive purview of the type that executives tend to guard jealously.

Also there were amendments to petition the State Legislature to levy certain taxes and several other matters. Presumably these would result in joint petitions on behalf of the City and the actual Act 47 coordinators themselves, theoretically providing more oomph to the requests.

Finally, there were loosenings of restrictions on "incentivizing" city employees.

Thereafter occured much discussion about what might occur dependent on how the overseers respond:

PEDUTO: Said he will NOT vote for a Recovery Plan that fails to include a hefty portion of these items (that wasn't his verbiage, but he kept it pretty vague).

MOTZNIK: Supported the amendments -- and seemed actively involved with Finance Chair Peduto -- and took Peduto at his word that most amendments would be adopted by overseers. He did not state a clear position on what he'd do otherwise.

KRAUS: Said he will NOT vote for a Recovery Plan without "these amendments", period, full-stop.

SMITH: "Definitely" can't vote for a plan without "a majority" of the amendments.

HARRIS: Via teleconference, supported amendments, especially those on workforce incentives. I did not catch a clear position on what would happen should they not go through.

SHIELDS: Abstained from taking a firm stance of the what-ifs. Of the opinion that this raft of amendments is too weak any darn way -- and recall our Post-It note. He seemed resolved to bring that, as well as the issue of whether or not Pittsburgh is already constitutionally empowered to levy a commuter tax, into another arena.

BURGESS: Supported proposed amendments, but declared his intention to vote IN FAVOR of Act 47 REGARDLESS of whether or not the overseers incorporate a single one of them. This was justified on multiple occasions with reference to the "unimaginable" "catastrophe" that would befall Pittsburgh without state oversight, which enables the city to "survive".

DOWD: Supported proposed amendments, but declared his intention to vote AGAINST Act 47 REGARDLESS of whether or not Act 47 incorporates every one of them. This was justified with assertions that Act 47 is onerous, has been un- or counter-productive, and most of all prohibits us from levying a commuter tax, and thereby addressing our fundamental issues.

PAYNE: Nothing she said indicated any intention to vote for Act 47 under any circumstance, but she "predicted" for all assembled that the Coordinators would take our 11 pages of amendments, pare it down to "just one" page, and still the rest of Council will end up giving it 8 votes next week.

So if Bill Peduto is correct and a sizable majority of the amendments are accepted, things look really simple and peaceful. If too many of the amendments get rejected (which we should know hopefully by Friday), the calculus gets daunting.


And after all of that ... individual Council members started proposing their own additional amendments to this list of proposed amendments, on the principle that since we're only asking, it would only be polite to allow every Councillor to attempt to adorn the thing with whatever they desire. One of these for example was the wholesale elimination of restrictions on new employee contract enhancements -- something that would be popular among unions but would certainly be very unpopular with state overseers charged with reigning in our expenses.

As the amendments packet was adorned like a Christmas tree, some skeptical members started referring to the packet as "fantasy amendments" and "fantasy legislating".

But in the end, the Act 47 Recovery Plan, now accompanied with a host of "recommendations", was granted preliminary approval mostly for procedure's sake, along with multiple qualifications that implied strongly this approval may be revoked.

Also Notable:

Dowd noted that of the sanctions that could potentially befall Pittsburgh should it not timely adopt a Recovery Plan, the vast majority would affect funds slated for the Urban Redevelopment Authority rather than the City's general fund. The implication I guess was who cares about those crumbums anyway. This I found to be a pleasing attitude.


  1. Bram you wrote," Finally, there were loosenings of restrictions on "incentivizing" city employees."

    While studing Industrial Engineering Technology...I learned that 'progressive management" favors incentive plans for employees.

    Unions generally do not like.

    Managers less than progressive, down right hate incentives for employees. Reason being, when employees point out areas for savings, managers become embarassed..angst ridden.

    Can you shed some light on loosening of restriction on 'incentiveness'....

    I was taught no one knows the problems better than the people that deal with them on everyday basis

  2. That whole conversation between Dowd, Peduto, and Shields about the ability to amend the amended plan was rather confusing. I didn't really understand what Peduto was trying to say.

  3. Monk - Thanks for the insight, that assumption about union enthusiasm was my own assumption. I can't shed light on the specifics right now, hopefully I'll score a hard copy before the day is out.

    Paz - That's because of the frequency of the word "amended". The new Act 47 recovery plan will be called the Amended Plan. Council was attempting to make amendments to the Amended Plan. Finally, individual councilors were offering amendments to the formally introduced raft amendments being considered for the Amended Plan.

    Unless you are talking about the legal ability of the Council to make amendments period. In which case, it is confusing because none of the persons speaking about it are attorneys, nor can we be assured they are in clear command of the statues being disputed. Mr. Shields did reference something about Sec. 249 of Act 47, I suppose I'll check that out though I'm no lawyer either.

    BONUS INFO: Mayor afterwords said Council is "trying to give the world an ice cream cone"; asserted Council should not be amending the plan by "handing out political chits". "Anything close" to the 35 amendments is off the table as financially irresponsible.

    In response, some representing the Council including Mr. Kraus are dismayed; they tell me they've vetted their amendments not only through their own budget director but through the administration already.

  4. Of course Mr. Kraus is dismayed. He is hard pressed to be anythin else when heavy lifting occurs.

    But, if he sticks to Peduto like white on rice -- I'll be happy.

    OVERLORDS are hard to deal with. Frankly, they are un-American.

    The root problem is not the overlords, really. Councils of the past and administrations of the past -- especially -- got Pittsburgh into this mess. They can't lead out of a wet paper bag. That whole is this ours to amend or not -- is frist class folly. They championed the arrival of the OVERLORDs. Wrongs built upon wrongs. No good decisions -- but they can't hardly decide to act in any way regardless.

    True, those that deal with the problems (employees) are the ones who understand them. But, did they make the problems too? Perhaps at times that is the case.

    We predicted the implosion back in 2001.

    But generally, I still hold out hope that we should REPLACE before we REFORM. And, now with the OVERLORDS, let's REMOVE, then replace those that are elected. Then reform. And here, the ones to make the problems are with the least of the ability to fix them.

  5. I am somewhat dismayed with Pat Dowd's attitude. We created the situation, we need to deal with it. If the tax structure for Pittsburgh is unfair, we need to lobby the State legislature to change it. And certainly we will accept any help anyone is willing to give us. But we aren't allowed to say we simply won't pay our debts because Act 47 is being too mean to us.

    Meanwhile, I suspect the Act 47 people are correct, I don't believe Council can so much amend the plan as they can propose amendments the Act 47 people can accept. If the Act 47 people amend the plan, then Council will need to approve it. 's my understanding.

  6. The power to amend is State's...I agree with ED.

    Gov. Swendell...wants to raise income much will be applied to unfunded pension liability of States only 2nd Class City.

    We are 2nd Class City for a reason. To serve Democrats...

    Pittsburgh lives in servitude...

    Swindell, will not hold Public Safety accountable...Of the 3100 pension funds in Commonwealth (Dan Onarato) who contributes to Social Security and who is exempt...

    Death benefits and disability for police and fire should be burden of Federal and police should be required to contribute to Social Security as a mater of Pennsylvania Law.

  7. I would be remiss if I neglected background...

    While in Navy I served as Shore Patrol and Firefighter...

    I contributed to Social Security...I was Cop and Fireman...

    Foot Soldiers in body bags lack 'Fallen Hero' designation...

    Maybe we bury own, with your help,
    by contributing to Social Security...

    Good virtue.

  8. Ed - I had precisely the same feelings of dismay as Dowd was previewing his position through most of the meeting. However, when he finally spelled it all out towards the end, it was pretty persuasive. Maybe not wholly so, but he certainly pulled me a good halfway there.

    If Council sessions were already online and fully editable, I would pair together about five minutes from Burgess at the top of the meeting with five minutes of Dowd at its conclusion, to illustrate the two extremes. I must say given how passionately they each feel about their respective irreconcilable positions, they were both beyond cordial and downright warm and friendly towards one another throughout.

  9. Rev. Burgess = Noriel Roubini.

  10. Dowd noted that of the sanctions that could potentially befall Pittsburgh should it not timely adopt a Recovery Plan, the vast majority would affect funds slated for the Urban Redevelopment Authority rather than the City's general fund. The implication I guess was who cares about those crumbums anyway. This I found to be a pleasing attitude.

    The ura is a key funding source for some. It is an unfortunate situation when people find it necessary to sell a doomsday scenario.

  11. TheTruth1- Actually, I thought Chris Briem had a lock on that role in these environs.

    TheTruth2- Partypooper. No, actually I'm sure you're right. It bears mentioning however that the sanctions involve withholding the funds and I believe actually placing them in escrow until such time as an Amended Plan is accepted -- the funds aren't surrendered forever even upon the Secretary's determination that we are to be punished for tardiness.

  12. I am happy, mostly, with Pat Dowd's words in the end of the meeting / vote. His attitude, that is hard to measure.

    Sure, Pgh created the situation. The situation is based upon over spending. The way to deal with over spending is to spend less. The TAX STRUCTURE -- of a Land Value Tax -- part of Pgh's legacy -- is NOT to blame. That is the best tax of them all.

    Bob O'Connor tossed the Land Value Tax out the window, sadly. His clueless acts can be un-done.

    Tom Murphy and Bob O'Connor did this harm to the city.

    The most fair tax structure is what they've had in the not too distant past and where they have departed. Get back to a Land Value Tax (with less spending) and we'll be much closer to thriving again.

  13. Bram,

    I agree. CB discusses the economic issues facing Pittsburgh as well as anyone else online. (Aside: The Allegheny Conference blog has some decent material, but it is more of a personal soapbox - with no commenting allowed! - than what you get with Null Space.)

    Anyways, the Roubini (“Dr. Doom”) reference has more to do with the Good Rev. and his view that an "unimaginable" "catastrophe" would befall Pittsburgh without state oversight,

    It seems to me that Rev Ricky's language regarding Act 47 is a little over the top. Pittsburgh would “survive” without oversight. Rev B. makes it sound as if questioning the state will result in the Great Flood Part II. As Dowd pointed out, this is simply not the case. We may miss out on some state funding for certain developments, but the city itself would find a way to manage without a lot of help from outside. It already does.

  14. Strange habit of mine, no cable...

    In fact I have yet to redeem 'Converter Box Coupons'...

    When will Council Meetings go on-line?

    Let The Sunshine In!

    It will be quick death to Twitters...Mayo and Delano, both Grant Street Ticks...

    Reason enough to put Council Meetings on-line.

  15. Rev. Burgess = Noriel Roubini.

    An intellectual prophet he is not..

    More like a spokesperson for the mayor or other words a kiss ^%&

  16. Why stop with on-line access to Council Meetings?

    Because legacy costs (pensions) are subject of scrutiny...why not put 'Public Pension Fund Board of Directors Hearings' on-line?

    Tried to have transcripts of 'Pittsburgh Municipal Employees Board of Directors Meetings' on-line in 1999 as Elected Member of same board.

    Doug Shields proxy for the Council President Bob O'Conner, strongly objected..

    ACLU was contacted...Vic said Doug had no legal ground to stand on...

    Debate was transcribed and is part of archive...Doug would be embarrassed 10 years later by his remarks.

  17. Not sure Noriel Roubini is intellectual prophet...economic intellectual perhaps.

    When I studied economics under Doctor Laird, I learned one thing:

    'Economics is an inexact science.'

    Don't have Doc's email address but you can contact Noriel Roubini at address below.

  18. Not sure Noriel Roubini is intellectual prophet...economic intellectual perhaps.

    Indeed. The man is an economic intellectual who has been pushing the idea of an economic flood for years. Now that a flood (of sorts) has occured and much of what he predicted has come true some label him a prophet.

    Other see him as a broken clock.....

  19. Back to my Briem / Roubini (Briembini?) argument, I was referencing Chris's unwaveringly alarming take toward our real public pensions situation -- most recently with reference to old vs. forthcoming actuarial reports, and poor trends continuing nationally that we know have only improved in their 2nd derivatives. In this I say he is Roubini, and I've yet to hear anyone forthrightly engage his core arguments.

  20. Burgess is more like the people on the radio telling you to BUY GOLD.