The financial impact of the coronavirus pandemic on Pittsburgh city government will be “deep and long lasting,” potentially changing the course of capital projects and other initiatives for years to come, a city official said Monday.
Dan Gilman, Mayor Bill Peduto’s chief of staff, said the budget office is working on projections. He could not provide the exact toll on city finances.
“I don’t know the answer on that yet,” he said. “We’re doing our projections now, but it’s very hard to project out when you don’t know how long this is going to last.”
He said the city will certainly experience a major decrease in tax revenue, including city real estate, amusement, parking and payroll taxes. He added that the stock market crash will have a major impact on city pension funding.
Pittsburgh’s 2020 operating budget projects $608 million in expenses and revenues. Long-range financial projections include surpluses in each of the next four years, ranging from $4 million to $8.8 million. The reserve fund balance in January was $85.8 million, according to the budget.
The pension liability for current and future retirees is $1.3 billion.
Gilman said the city has stopped all capital projects during the crisis.
“We’re spending money for the emergency right now that wasn’t budgeted, and we don’t know if we will be reimbursed,” he said.
Peduto earlier on Monday called on Congress to release $250 billion in relief for cities and municipalities.
Gilman said he anticipates a future hold on hiring and cancellation of capital projects, including facility and equipment upgrades this year and for years in the future.
“The city has to make payroll and stay within a balanced budget,” he said. “It will take a tightening. The hit could be for many years.”
