This was supposed to be a long, hot summer for Mayor Tom Murphy. Before Memorial Day, he was at loggerheads with the Intergovernmental Cooperation Authority, a five-member panel created to oversee the city's struggling finances. By all appearances, the excrement was about to hit the City County Building's air conditioning. When Murphy proposed a financial rescue plan in May, board members lambasted him for leaving the budget $36 million out of balance, and including cost cuts it called "dubious." In a May 21 letter, the ICA also groused that, although City Council must approve any financial recovery, councilors "had no input into the Plan."
For a moment, it seemed like a cold day in Hell -- or at least a Pittsburgh July -- had finally arrived. Murphy had proposed budgets based on non-existent taxes before, and he's never been much of a team player. But finally, someone was standing up to his imperious style, proclaiming the naked truth behind the emperor's new revenues.
By Labor Day, however, Murphy and the ICA were practically sharing a picnic blanket. In fact, they're now both doing exactly what the ICA faulted Murphy for: hatching budget plans that rely on non-existent revenue and keeping City Council in the dark.
The trouble started, oddly enough, when Murphy did what the ICA asked. With the help of another state-appointed bailout team, Murphy proposed a budget based on $33 million in real cuts. Originally, the ICA insisted that wasn't enough: If Murphy was going to get the new taxing powers he wanted from the state, the board told him, he would have to find a total of $50 million in cuts.
Murphy delivered, sort of: After negotiating with ICA head William Lieberman, Murphy wrote up an Aug. 6 letter pledging to find the extra money. This plan relied on non-existent funds too -- money from gambling, state grants, savings in workers comp and increased billing for ambulance service. Murphy acknowledged that the new money was "speculative" and that "these ideas are not yet firm in amount."
But this time, the ICA wasn't complaining. In fact, Lieberman contributed some phantom revenues of his own, pledging to help the city find $11 million from non-profits -- nearly twice the amount Murphy had originally sought. Apparently, the problem was that Murphy hadn't been relying on imaginary revenue quite enough.
In fairness, the sums at stake here are much smaller than in previous Murphy proposals. And as mayoral spokesman Craig Kwiecinski justly points out, "The difference is that [these revenues are] something we can achieve here locally." Murphy's earlier budgets demanded sweeping changes to the city's tax structure, changes that could only be enacted in Harrisburg.
But there's probably a better reason the ICA didn't wake Murphy up from this midsummer night's dream: Its $50 million goal was just as fanciful as Murphy's plans for meeting it. The ICA itself never offered a single suggestion about how to meet that number; in fact, it has yet to offer any cost-saving ideas at all. Accepting Murphy's "speculative" numbers lets themselves off the hook as much as Murphy.
Meanwhile, City Council, the group whose participation the ICA was so concerned about in May, has been sweating ever since. While Murphy and Lieberman met in secret, councilors were grilled by the public for every cut in jobs or services. An increasingly irate council passed measures requiring various reforms to the oversight board, including a proposal to make the all-white-male ICA board more diverse. Murphy vetoed these measures. Later, he issued a statement contending that while "[a]ll of us â€¦agree with the need for diversity on the ICA board" it would be "inappropriate to formalize" that agreement.
Afraid of stalling the city's recovery efforts, council abandoned its reforms. Murphy, who seemed trapped in the doghouse just months ago, is enjoying some late-summer dog days of his own. For now, at least, he has an ally: an ICA board that can boast of being a fiscal watchdog that delivered $50 million in "savings." The city may even be better off as result: With the ICA in his corner, Murphy may yet get Harrisburg to change the city's outmoded tax structure. As silly as the ICA has acted, Murphy's deals with it may lead to sunnier days for everyone.
Except, of course, for those who hoped to spend their summer vacation watching Murphy squirm.