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Wednesday, May 2, 2012

County Controller decries fiscal situation, blames governor

Posted By on Wed, May 2, 2012 at 4:58 PM

County Controller Chelsa Wagner had harsh words for Gov. Tom Corbett, and his proposed budget cuts, as she outlined the county's finances today.

"I think it's very, very, very fair to say we've been dealt a bad hand by the state," Wagner said at a morning news conference. "And it's one I find particularly disappointing when we have a governor from Allegheny County looking at the cuts proposed in this budget year." "We need Gov. Corbett to remember where he came from," she later said of the Shaler Republican.

While presenting a report on the state of county finances for 2011, Wagner called on Corbett to reinstate two state grants the county had been receiving for public safety. The grants amounted to approximately $7.5 million.

In reviewing the county's books, meanwhile, Wagner noted the areas of greatest concern are: a decrease in the general fund balance; dependence on one-time funding sources; and state and federal funding cuts -- as well as "looming uncertainty" involving future funding streams.

"I think the message is clear that county government can no longer exist in a constant state of financial instability with little flexibility and inadequate resources for us to invest in the future," she said.

Wagner pointed to the General Fund balance as one of the county's "most pressing financial issues," while noting that rating agencies suggest keeping a fund balance of $35 million. In 2002, the county's fund had $47.4 million in it; at the end of 2011, it had $6.2 million.

"This is lower than many school districts in Allegheny County," she said. "We keep kicking the can down the road and at some point, we're going to have face the problem," she said.

And though the county has already levied a 1-mill property tax increase estimated to generate $53.8 million, Wagner said the new revenue will have only a small impact. "This is really going to be plugging holes from lost funding sources."

Among the items Wagner said she was "cautiously optimistic" about: The region's housing market grew in 2011; economic development created 11,400 new jobs and retained 5,260 in the region; and that the county's unemployment rate stayed below the state average.

In a statement released this afternoon, county executive Rich Fitzgerald said he wasn't surprised by Wagner's findings. "Our $6 million fund balance is the lowest it has ever been. Although we have controlled costs and streamlined government, we have also seen decreases in state and federal funding that we have had to contend with at the county level."

The statement further asserted that the 1-mill increase will prevent laying off 1,000 employees and that his office is meeting with every department to review budgets and identify savings.

"Our directors and employees are already doing more with less and we're now asking even more of them," Fitzgerald said.

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