Scranton’s financial plight is far from solved, but the city is on the verge of closing a long-running dispute with its police and fire unions.
The City Council on Thursday night introduced tentative settlements reached June 1 that evolved from last October’s Pennsylvania Supreme Court ruling that cities defined as distressed under state law cannot use their status to lower the costs of arbitration awards. The state legislature has since passed legislation amending the Distressed Communities Act, known commonly as Act 47.
Under the settlement, the award will amount to about $16 million, half of what the unions originally wanted. “It’s a good deal because the bargaining units gave in a great deal, and the raises are minimal and would not be harmful to the budget,” Mayor Chris Doherty told the Times-Tribune of Scranton.
Scranton, which had been paying its employees the federal $7.25 per hour minimum wage since July 6 because it was nearly broke, was able to pay city employees in full this week, with officials citing increased tax collections.
Also Thursday, the council asked the Scranton Parking Authority to return the $1 million that the council approved on June 14 to cover a late authority bond payment the city had guaranteed. Four of the five council members questioned why the authority’s debt-reserve fund increased to $4.3 million as of June 30 from $3.2 million on Dec. 31, 2010.
Doherty is looking for a loan he says is necessary for the city to cover its 2012 budget deficit of $16.4 million and repay a short-term loan of $2 million it could get from the state.
Pennsylvania’s Department of Community and Economic Development has offered Scranton an interest-free $2 million loan and a $250,000 grant if the mayor and City Council can agree to a financial recovery plan by Aug. 1 and ratify it by Aug. 15.
The council will next meet on Thursday.
