Allegheny County Can, Must Pare Its Budget
With Allegheny County Chief Executive Sara Innamorato’s proposed 46.5 percent property tax increase to fund her 2025 budget an apparent dead letter, some County Council members say it’s time to look for cost savings.
And with “austerity” appearing to be the council’s new buzzword – whether that’s for political expediency or fiscal practicality remains to be seen – a scholar at the Allegheny Institute for Public Policy says benchmarking should become a crucial tool in the coming budget deliberations.
“Benchmarking, along with the tools in the Home Rule Charter—particularly the sunset review of departments and next year’s once-in-a-decade Government Review Commission—are vital to making sure that county operations are efficient and affordable for taxpayers,” says Eric Montarti, research director at the Pittsburgh think tank (in Policy Brief Vol. 24, No. 36).
In was on Oct. 8 that Innamorato presented County Council with the operating ($1.2 billion); capital ($130.6 million); grants ($1.6 billion) and special accounts ($168.1 million) budgets totaling $3.1 billion.
“Comprised of general, debt service, liquid fuel, transit support and infrastructure support funds, the operating budget includes the first property tax increase since 2012,” Montarti reminds. “Millage would rise from 4.73 mills to 6.93 mills (again, 46.5 percent), more than double the 21 percent increase in 2012.”
The rationale for the proposed increase was to close a deficit in the operating budget and build the fund balance, the latter, especially, considered crucial to maintaining an acceptable bond rating for borrowing.
Back to benchmarking. It was a central component in the shift to home rule and the executive-manager-council form of government nearly 25 years ago. It was in the 1996 study, ‘Preparing Allegheny County for the 21st Century,’ that six counties were selected to serve “as models of quality government and economic progress.”
Those counties – King County, Wash.; Hennepin County, Minn.; Davidson County, Tenn.; Mecklenburg County, N.C.; Montgomery County, Md.; Milwaukee County, Wisc. — were either places known to be competing with Allegheny County for jobs, had a reputation as an exemplary government or presented a different form of county government, Montarti reminds.
Updating all the county’s respective population and job-growth data, coupled with the addition of new benchmark jurisdictions, reveals Allegheny County’s stark operational challenges, if not outright bloat. Those additional jurisdictions include Franklin County, Ohio; Salt Lake County, Utah; Douglas County, Neb.; and Hillsborough County, Fla.
“On per-capita revenue—which takes into account taxes, fees, intergovernmental revenue and all other sources across all governmental funds—Allegheny County ranked second highest and was 33.2 percent above the peer-group average,” Montarti notes.
“On per-capita expenditure, which measures general government functions, public safety, health and others, Allegheny County ranked highest and was 46.5 percent above the peer-group average,” the think tank researcher found.
“On full-time equivalent employees per 1,000 people, Allegheny County ranked second-highest and was 4.1 percent above the peer-group average,” Montarti concluded.
Surely there must be areas to pare. Montarti says that at the 2023 population estimate, operating budget spending equates to $981 per capita.
“Consider that of the county’s departmental appropriations by program area, only health and welfare administration, court records and juvenile court placement would see spending decreases in 2025 over this year,” Montarti finds.
“While the budgeted headcount of 6,151 is the same as the 2024 operating budget total, there are 11 departments that are budgeted for additional headcount, offset by decreases in six departments,” he says.
“Savings must be found in other departments and functions in the 2025 budget deliberations,” Montarti stresses. “That’s a far more fiscally responsible course to take as opposed to a property tax increase.”
Colin McNickle is communications and marketing director at the Allegheny Institute for Public Policy ([email protected]).
