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Wednesday, July 18, 2012

Struggling Pennsylvania Cities Are Hamstrung By State Law, Bad Decisions

In Pennsylvania, so many cities and towns are in financial distress that one economic development specialist has what he calls a “measles map” of the state, covered with 27 red dots representing struggling communities.

One in four Pennsylvanians lives in a financially distressed city or town. There’s Scranton, where this month the Mayor cut city workers’ pay to minimum wage. In the state capital Harrisburg, money is so tight that the city, which filed for bankruptcy last year, recently entered into “Act 47,” the state’s 25-year-old program to turn around the worst-case local governments. They’ll have a recovery plan created for them, but the city doesn’t have to adopt it. In fact, only six cities have ever graduated from Act 47.

Stephen Fehr, senior writer for Stateline.org, says Act 47 is an ambitious program but it doesn’t accomplish a lot because the state can’t control outside events such as the drop in manufacturing jobs, court rulings that back higher pay for municipal workers, and bad fiscal decisions made by local elected leaders.

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