Some interesting stuff on KD/PG Sunday Edition (wait — did I just say that?) this week. I was especially interested to watch the in-studio interview with city councilor Bill Peduto and presumptive councilor-to-be Natalia Rudiak.
Peduto sounded like a kid for whom Christmas came early. What did it mean that Rudiak had won her May 19 primary, along with Peduto’s former campaign aide, Daniel Lavelle? Said Peduto:
You’re going to be taking away two rubber stamps and putting in two independent thinkers who are going to base their decisions on policy, not politics. I’m going to sit at that council meeting, I’m going to have a cup of coffee in front of me, and I’m going to enjoy the debate. That’s why I got in this. I feel finally there’s going to be that council I’d hoped for.
Peduto also waxed nostalgic for how life was in the good old days, when he was an aide to his predeccessor, Dan Cohen. Back then, Peduto contended “There was a debate on issues,” thanks to the leadership of guys like Jim Ferlo, Alan Hertzberg and Bob O’Connor.
Huh. I’m not sure that’s quite how I remember it, but OK. In any case, there’s little arguing with Peduto’s larger point: On today’s council, too often “There has been no debate. There has basically been a rubber-stamp for the mayor.”
The question is what the newcomers will do to change the equation. Rudiak was walking a very thin line on the show. As Chris Briem pointed out, while District 4 elected Rudiak, it also went more heavily for Mayor Luke Ravenstahl than any other district in the city. Rudiak has to be mindful of that, and her top priority has to be addressing district needs.
So on Sunday, she pledged “to having an intelligent and an ethical debate about the issues,” and noted that one challenge in her district was a loss of faith in city government. But on the other hand …
To whatever extent other city council members and the mayor’s office want to work with me to bring investment to the South Hills, they’ll find an ally in me… I’ve said this from day one: Anybody who is interested in working with me to bring investment to the South Hills — whether that’s working with community groups, whether that’s providing more efficient city services, whether that’s working on implementing policies citywide that would benefit the entire city, that’s what I’ll do.
So naturally there is some tension here. Rudiak got elected — in part — with the help of a lot of Peduto backers. But she can’t afford to be captive to Peduto’s agenda. Pittsburgh still has a strong-mayor system even if results of the council election make Ravenstahl look weak. It’ll be interesting to see how she negotiaties this stuff.
Peduto himself, when not rubbing his hands together and cackling with glee, predicted the city would soon have “not an antagonistic council but an independent council. A council that serves not as a function of the mayor’s office anymore.” Which seems about as much as we can hope for.
Bram’s guess would be mine as well: While they represent very different districts, Rudiak is going to occupy the same political territory as Ricky Burgess. More than Peduto or Shields, whose districts include some of the city’s most prosperous neighborhoods, she’s going to have to balance district needs with loftier concerns about transparency.
Right now, she seems most interested in keeping options open. Rudiak and Peduto were asked about specific policy intiatives, and Rudiak’s answers were not terribly transparent.
Peduto, for example, discussed his hope to replace the city’s $52-a-year commuter tax with a tax levied as a percentage of income. This resulted in a spirited (by KD/PG Sunday Edition standards, I mean) exchange. When it came time for her to weigh in, Rudiak observed that people in her district lived just across the border from other adjoining municipalities (so do people in other council districts, of course).
“People in the city feel that we are being burdened by taxes,” she said. “[I]t’s a real issue that we need to look at.”
***
Up above there, I gently chided Peduto for waxing nostalgic over the good old days when Tom Murphy was mayor and we had luminaries like Joey Cusick on council. But I experienced a bit of deja vu this weekend too, after reading this story about Mayor Ravenstahl’s renewed efforts to levy taxes for the sake of bailing out the city. It’s like somebody on Grant Street found the Murphy political playbook in a desk drawer and decided to dust it off.
Let’s see …
— An almost certainly fruitless attempt to get the non-profits to pay more taxes? Check.
The mayor said there’s “clearly the need for nonprofits to contribute more than they do currently, whether that’s through state action or through increases in voluntary [contributions].”
— The claim that when even suburbanites go out of town, they tell people they are from Pittsburgh? Check.
“[W]hen you go out of town, and you’re asked where you live, you say Pittsburgh,” Mr. Ravenstahl said
— The plea that, hey, our paramedics will treat you for a medical emergency without checking the ZIP code on your driver’s license? Check.
“We all experienced a great Penguin win [Thursday] night. There were a lot of people that came to that game that didn’t live in the city. Our police officers helped them to get out of there afterward by directing traffic. Our firefighters and paramedics were there to make sure that everything went well.”
I’m not saying I disagree with any of this stuff, necessarily. I didn’t disagree with it when Murphy said the very same things. But past experience suggests that this is not a winning approach.
The problem is simple: It’s not in the political interests of, say, state Sen. Jane Orie to tax her voters for the sake of constituencies outside her district. If Paul wants Peter’s money, he should at least move to McCandless.
Of couse, we can get all het up about the need to “think as a region” and to “show leadership that transcends petty politics.” But then, Tom Murphy liked to lecture suburban officials about their responsibilities too. Look where that got us.
What would I do instead to help build support for more taxing power to help the city? I’d exploit the fact that some suburbanites actually do have a very direct stake in the city’s fiscal well-being.
As we reported last year, there are scores of suburbanites out there who used to be city employees — and who still depend on the pension checks they started getting when they retired. The city’s pension fund is dramatically underfunded, which means there are a couple hundred suburbanites whose retirement is at stake. If Jane Orie votes to let the city rot, she’s letting those constituents suffer too.
When Orie lectures the city about fiscal responsibility, underlying the argument is the claim that, hey, your voters got you into this mess … let them get you out of it. But that argument starts to fray when you realize that
a) many of the people actually benefiting from these pensions no longer live in the city, and
b) many of the people paying those pensions didn’t live in the city back when those suburban pensioners retired.
To some extent, there’s a transfer of wealth between working-class folks in the city, and retirees living comfortably out in the ‘burbs.
But again: Economic justice arguments don’t get you anywhere. The real point is that there is a pool of people out in the suburbs who are depending on the city’s pension fund remaining solvent. The city might want to think about mobilizing them.
I’m not sure that will work: The number of suburban-dwelling retirees isn’t that large, relatively speaking. And who knows whether they’d want to tax their current neighbors to help out people they used to live next door to. But I guarantee one thing: If you could find retirees who would help make the argument, they’d be more sympathetic figures than Luke Ravenstahl.
This article appears in May 21-27, 2009.
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“b) many of the people paying those pensions didn’t live in the city back when those suburban pensioners retired. “
Yes, this is a HUGE issue. We were just talking to two of our neighbors at a picnic yesterday. They’re both technology workers with two small kids who moved to Pittsburgh from elsewhere: exactly the people Pittsburgh frets about losing all the time due to brain drain.
And they’re thinking of leaving, not because they’re unsatisfied with their life in Pittsburgh now — they seem to love it, actually — but because they don’t want to put down roots that are too deep only to have to pay massive taxes for reduced services in a decade to make up the pension deficit. “We’re not going to sacrifice our kids’ college fund to make up for the financial mismanagement of the city by the same people who now expect us to sacrifice for their benefit,” said the wife (roughly).
More people are paying close attention to this pension issue than I would have expected. (And to tie into your point about Rudiak and District 4’s support of Ravenstahl, the couple was really impressed that Ravenstahl was finally tackling the pension issue and therefore supported him even though overall they’re more like Peduto/Dowd types.)
When Rudiak said, “Whether that’s working on implementing policies citywide that would benefit the entire city…”, that was encouraging. There’s a ton obviously that can directly impact a District or a business district or storefronts or community groups or whatever that actually has to do with policy shifts, rather than the mean tug of war for resources. Also, though her words were vague and noncommittal, I could swear there was something in the lilt of her voice that suggested not only support of the commuter tax but also of Peduto’s scheme to scale it according to income.
I agree there needs to be a better pitch for these taxes than economic justice, I just ain’t figured it out yet. Closest I come is raising the prospect of the City going supernova and then black hole. So, fear. Also not perfect.
“the couple was really impressed that Ravenstahl was finally tackling the pension issue and therefore supported him “
>>> Haha. I just heard the distinctive champagne-cork sound of Chris Schultz’s head exploding. (For more on this internet in-joke, see http://techandpolitics.blogspot.com/)
It occurs to me, though, that one difference between Ravenstahl’s pitch and Murphy’s is timing.
Ravenstahl is making his plea in an economy where taxpayers are ALREADY bailing out all manner of mistakes in the private sector. One of the chief problems in the auto industry, for example, is the “legacy costs” of all the pensions given to the former employees in Detroit. And the (government-backed) PBGC has been picking up the tab for failing private-sector pension plans over the course of years.
A few years ago, it was a lot easier to blame Pittsburgh’s problems on Pittsburghers — their reckless officials, powerful unions, etc. But can we really be in favor of bailing out Wall Street and Detroit, but AGAINST shoring up the retirement fund for police who put their lives on the line every day? (As witness the Stanton Heights shooting.) Then, too, one reason the city has these pension shortfalls is losses in the stock market … are we really going to castigate city taxpayers for that?
Hell, back when Murphy was in office, Orie’s brethren in the GOP were leading the charge for privatizing social security — we could better invest the money in the stock market, they said.
City Democrats didn’t corner the market on bad decisions … but it seems like they’re the only ones being held accountable for it. Actually, it’s not even those officials — it’s their successors, and the taxpayers they left behind.
Am I missing something specific about pensions that you wanted me to see? Or is the joke just that he’s histrionic?
(WRT our previous discussion, I’ll admit my stomach did a little flip to see that he gave $100 to the Rudiak campaign. That’s a lot of money for a city council race: I wonder if he lives in our district?)
Oh, did anyone else think that Peduto seemed a little… off during the interview? I like him and worked on his mayoral campaigns, but he just seemed really humorless on Sunday. Like when Smith makes the (admittedly lame) joke about how we shouldn’t emulate Cleveland, and Peduto sharply says, “What I WANT is a percentage…”
Per Bob Mayo, who has probably actually read most of the thing, the new Act 47 plan recommends raising the EMS tax and taxes on non-profits only as a last resort. It mostly doesn’t tell us what to do as a first resort to cut costs, except for how not to give raises and how to put the boot to the City Unions. It does mention that we should consider raising the local income and property taxes *before* going to the State Legislature.
Instead Ravenstahl comes crashing out the gate with these last resort tax increases, acting indignant that the legislature hasn’t already passed these measures and complaining he can’t get a meeting with Orie. Ravenstahl is already counting the dollars. No wonder Orie is pissed. The way the Act 47 plan reads, she shouldn’t have had to hear about new taxes for Pittsburgh for at least a couple of years, if ever. Instead two days after the proposal is delivered Ravenstahl is complaining about the State Legislature.
Ed, I’m not sure I agree with your take on the Act 47 plan’s approach to revenue. The Act 47 folks assembled a “preferred” approach and a “failsafe” approach to boosting the balance sheet. The preferred approach involves: finding new efficiencies beyond what the REST of the report already spells out; raising the EMT tax to $145/year; and other options which could include canceling a further reduction in the parking tax and getting more from non-profits (the report says $6 million a year is a reasonable amount).
The “failsafe” option is a straight $10 million revenue boost in the form of a tax increase to revenues the city can control — like property tax rates.
Bear in mind that the Act 47 folks ORIGINALLY proposed a $145 EMT way back in 2004. The amount got chiseled down by the state legislature. So it’s no surprise to see the Act 47 folks bringing it up as a “preferred” option this time around. In fact, if you read the report through, you’ll see there are numerous ways in which state action/inaction has hamstrung the city’s efforts. I’m critical of Ravenstahl, but I don’t think Senator Orie deserves any roses either.
To take one example — a favorite gripe of Tom Murphy’s: The state helps municipalities with pension obligations, but the formula for allocating money is based on the current number of ACTIVE city workers, not the number of RETIREES. And of course right now, it’s the retirees who are burning through the pension fund. As Murphy was fond of pointing out, that formula punished the city for reducing its current workforce, since doing so would cost it state aid for retirees. The city was being told to be more efficient, but took a fiscal hit for doing so.
The city has been under fiscal oversight for 5 years. The Act 47 report repeatedly credits city officials for doing a commendable job of living up to their end of the bargain. The result is that the city isn’t running the kind of operating deficits it was a few years back. But there’s a much larger problem of legacy costs still hanging out there.
You can bet the city will probably have to make other tough choices going forward. But given that many other municipalities are struggling with similar issues, and the painful choices Pittsburgh has already made … is it unreasonable to start asking some questions about the legislature’s obligations here?