Fast exit from Act 47 brightens Altoona’s future

Pennsylvania’s Act 47 was a godsend for Altoona, but the city’s exit on Wednesday from underneath the distressed-municipalities program’s financial umbrella plants the seeds for many positive opportunities in the years ahead.

Current and future city officials must work unceasingly to capitalize on the potential benefits that being free from the stigma — the black eye — associated with the program will offer.

Departure from the program delivers the message that Altoona again is a vibrant place — a great place to live and work and an excellent place to operate a business.

That’s something people here have known for a long time, but being labeled “distressed” doesn’t deliver that upbeat message to people unfamiliar with the community.

The city’s ability to exit the program after entering it just more than five years ago demonstrates the excellence of the governmental leadership and the cooperative spirit that exist here.

Those overseeing the municipality committed themselves to fixing the things that went wrong in the years leading up to 2012, and with the help of the state government, good decision-making by county government, sacrifices by city employees and help from city-related entities, Altoona was able to clamp the financial hemorrhaging that was eroding the city’s many positive attributes.

Exiting the program tells the world that this community again is poised for great things, supported by a strong fiscal backbone and determination to ensure that Act 47 never will have to revisit the Mountain City.

It’s a goal that nearby Johnstown covets, having not yet been fortunate enough to overcome the financial challenges dogging it.

While Altoona has exited the state program after having entered it on May 3, 2012, Johnstown, an Act 47 community since

Aug. 21, 1992, likely will ask the state next year for three more years of participation, despite having reduced staff, implemented cost-cutting actions and made adjustments to employees’ health benefits for future years.

According to an article in Wednesday’s Johnstown Tribune-Democrat, Johnstown’s expenses have been growing at a rate of approximately 2.5 to 3 percent annually, while incoming revenue has been increasing only by 1 to 1.5 percent — not a recipe for the Flood City to leave Act 47.

Meanwhile, Altoona, which was faced with a nearly $1 million deficit in 2011, has been able to record a healthy budget surplus in all but one year after its entry into the distressed-municipalities program.

Among the factors making surpluses possible were the city’s shift to home rule, which allowed Altoona to make needed — albeit unpleasant — taxing decisions. That included the county’s long-overdue countywide property reassessment, which will continue to provide taxation “wiggle room”; and willingness of the city’s three unions to accept wage freezes on a three-year contract and now meager 2 percent pay increases each year under their current five-year pacts with the city.

Another big factor is the city’s recent takeover of the water and sewer systems in a lease-back deal with the Altoona Water Authority, guaranteeing continuing revenues of approximately $4 million annually, with raises built in for the future.

At a ceremony Wednesday marking Altoona’s Act 47 exit, city leaders were rightly praised for their tough decisions over the past five years. Altoona is the fastest city and largest municipality ever to exit the program.

Altoona’s exit positions the city for an exciting future, with no stigma to limit its possibilities.