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City eyes budget shortfalls

Without federal aid, Altoona may need to cut police, firefighter positions

Altoona will need to cut employee positions, including police and firefighters, unless the federal government provides direct funding to offset revenue losses connected with COVID-19, according to Mayor Matt Pacifico, one of seven “rust belt” mayors with similar warnings on a conference call Friday sponsored by the U.S. Conference of Mayors.

Neither Pacifico nor City Manager Ken Decker would get specific about how many such cuts might be needed when contacted after the conference call.

“We don’t know how it’s all going to pan out,” Pacifico said.

Earned income tax losses and other revenue shortfalls have led to projections of a budget deficit of about $1 million, according to Pacifico, a Republican, who was on the call with Pittsburgh Mayor Bill Peduto, a Democrat, the mayors of Dayton, Parma and Lancaster, Ohio; and those of Lansing and Rochester Hills, Mich. — plus the mayor of Louisville, Ky., president of the conference.

Seventy percent of expenses in Altoona’s $33.3 million budget go toward labor costs, with two-thirds of those allocated for public safety — and much of the 30 percent of costs unrelated to employment is fixed — so it’s hard to overcome a big shortfall without cutting personnel, Decker said.

In early April, the city received $966,000 in special Community Development Block Grant funding from the Coronavirus Aid, Relief, and Economic Security Act, but restrictions on its use prevented the city from applying it to the COVID-19 shortfall, Pacifico said.

The city ended up allocating the money for projects that included support for programs operated by Blair County Community Action, Catholic Charities, the Nehemiah Project and Altoona Blair County Development Corp.

The city is grateful for that help, but there’s only so much personal protective equipment you can stockpile, the mayor said.

The mayors are asking for “direct” money that could cover COVID-19 budget shortfalls.

“We’re asking them to provide us with a lifeline,” Pacifico said.

The political parties are currently negotiating a new aid bill in Washington, with Democrats favoring the addition of new money and Republicans favoring the lifting on restrictions on money already allocated — but mostly unspent — so it can be used as the mayors wish, according to a source familiar with the process who didn’t want to be named.

If the Republicans prevail, Altoona could potentially benefit by requesting and receiving some of $11 million in Coronavirus Relief Fund money received by Blair County as part of a distribution by the state of $4 billion to all the counties except those with more than 500,000 people, which received their funding through a different mechanism, according to the source.

So far, Blair has not allocated any of that $11 million for specific purposes, although it has earmarked $5 million for broad categories, said Commissioners’ Chairman Bruce Erb.

The money can’t be used to make up for revenue lost due to COVID-19, which is “bad policy,” however well-intentioned it was initially, Erb said.

Generally, the county commissioners agree with the mayors about the onerousness of the restrictions, Erb said.

The restrictions for the $11 million include a requirement that the money be spent by the end of the year, coupled with county liability for repayment if spending restrictions are violated, Erb said.

Erb said he would like to see some of that money go for broadband access in areas where there’s a lack of coverage, which is problematic during the pandemic, because it precludes online learning for students, teleworking for employees and telehealth for patients.

The commissioners are currently refining the application materials for the money, Erb said.

“Everyone wants the time extended and the restrictions loosened,” he said.

But it makes sense to spend the CARES Act money that has been allocated before allocating new funding, according to U.S. Sen. Pat Toomey, a Republican.

“Just four months ago, Congress sent about half a trillion dollars to state and local governments to cover COVID-19 related costs, boost Medicaid funding and support local public health programs, hospitals, schools and mass transit,” Toomey said in an emailed statement.

That included almost $5 billion for Pennsylvania, which is “still sitting on over $1 billion,” Toomey stated.

“Every dollar that was spent through the CARES Act was either borrowed or printed,” Toomey said. “Before Congress spends even more money it doesn’t actually have, states and counties should allocate their existing allotments so we can thoughtfully determine what needs remain.”

On the contrary, new money should be allocated, according to U.S. Sen. Bob Casey, a Democrat.

“I am pushing for more state and local funding to be included in the next relief bill because we need to do everything we can to help our states and cities and towns, large and small, to continue to function and provide services,” Casey said in an emailed statement. “Our teachers, firefighters, police, first responders and communities need continued relief.”

House Democrats included nearly $1 trillion for state and local funding in the HEROES Act in May, “and it is past time for Republicans to take this issue seriously,” Casey spokeswoman Natalie Adams wrote in an email. “Republicans are prioritizing corporate interests,” while President Donald Trump’s criticism that the funding has nothing to do with COVID-19 is “insulting to our communities and the workers who keep them functioning,” Adams wrote.

“It’s key that our hardworking public servants, including police and firefighters, are supported as they protect our communities,” U.S. Rep. John Joyce, R-13th District, said in an emailed statement, referring to the CARES Act money allocated to Pennsylvania that remains unused.

The mayors conference doesn’t like the plan unveiled by the Republican-led Senate on July 27.

“This (draft) legislation provides no meaningful relief for cities, which have been on the frontlines of this response and are now facing devastating budget shortfalls,” stated conference President Greg Fischer, the Democratic mayor of Louisville, in a statement that is on the mayors’ conference website. “Without direct relief to help fund police officers, firefighters, public health workers and other critical public employees, cities can’t do the work to fight this pandemic.”

Rust belt cities in Pennsylvania, Ohio and Michigan are facing a third economic devastation, after the Great Recession of 2008 and the generational erosion of industry, according to Pittsburgh’s Peduto, whose city projects a $100 million shortfall in its current $600 million budget.

Raising taxes isn’t the answer, because “it’s hard to raise taxes on people who are losing their jobs,” Peduto said.

“We need help, and we need it soon,” said Mayor Dave Scheffler of Lancaster, Ohio, a conservative city of 41,000 near Columbus. Things had been good in Lancaster, with unemployment at 4.5 percent, but that rose to 18 percent in April, he said.

“In normal times, local government is hard,” said Tim deGeeter of Parma, Ohio. “With COVID-19, it’s almost impossible.”

“It’s showtime in D.C. right now,” Fischer said. “They need to get this deal done.”

Mirror Staff Writer William Kibler is at 949-7038.

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