A bill to help Pennsylvania's 27 officially distressed communities cope with mounting costs of arbitration settlements and awards received final legislative approval.
The House of Representatives on Thursday approved without debate a bill the Senate had approved the previous week by a 47-1 vote. Gov. Tom Corbett has said he would sign the bill, which municipal employee unions and the Pennsylvania League of Cities and Municipalities favor after the parties reached a compromise.
Lawmakers pushed for the bill after the state Supreme Court last fall ruled that distressed Scranton had to pay arbitration awards to city police and firefighters. The city's estimated liability is $20 million to $30 million.
Scranton had argued that arbitrators lacked legal authority to award relief that impinged upon the city's financial recovery plan under the state-sponsored Act 47 plan for municipalities in fiscal distress.
The bill would not aid Scranton retroactively.
It would allow an arbitration settlement under the Policemen and Firemen Collective Bargaining Act, known commonly as Act 111, to deviate from an Act 47 recovery plan only if it will not exceed the cap, will not jeopardize the financial stability of the distressed municipality, and is consistent with policy objectives of Act 47.
The court differentiated between the terms "arbitration settlement" and "arbitration award."
"The court decision affecting Scranton had ramifications throughout the commonwealth," said the primary sponsor, Sen. Jane Earll, R-Erie. "More broadly, we needed to deal with some of these cost drivers that are putting some of these communities into financial distress."
