The Allegheny County Council ended a two-month budget impasse on Tuesday by voting to increase property taxes by $1.7 million, or $1.70 per $1,000 of assessed value, to fund the 2025 operating budget of $1.17 billion.
The budget, which received approval from the minimum of 10 of the 15 council members needed to pass, represents a compromise between County Executive Sara Innamorato’s original proposal, which further raised spending through a $2.2 million tax increase, and council members’ counterproposal last week, which said, that it would only raise taxes by 1.35 million.
“This budget has everything we need, but not everything we want,” Innamorato said after the vote. She said this allows the county to avoid layoffs, hiring freezes and cuts to key programs. She pledged to “audit every dollar we spend” and look for novel improvements and state-of-the-art policies that will save taxpayers money in the future.
“But you can’t do that if you’re worried about keeping the lights on,” she said. “And if we exceeded the budget we passed today, we would be in an unsustainable state of austerity, and we wouldn’t have the opportunity to take the time to step back and innovate.”
Councilor Nick Futules, who voted in favor of the 1.35 million proposal last week, did not hide his emotions as he explained his support for the 1.7 million increase.
“How can you say no to seniors who need us?” Futules said, fighting back tears. “How can you say no to children? It’s arduous. This is not an uncomplicated choice when you have to raise taxes, when you have to deal with the people who pay them and those who receive benefits.
“I’ve been here 17 years and I think it’s the hardest thing I’ve ever done.”
Voting in favor of the budget were council members Jack Betkowski, Futules, Dan Grzybek, Bethany Hallam, Paul Klein, Michelle Naccarati-Chapkis, John Palmiere, Bobby Palmosina, Anita Prizio and DeWitt Walton. Councilors David Bonaroti, Sam DeMarco, Suzanne Filiaggi, Bob Macey and President Pat Catena voted against.
Before voting against the budget proposal, DeMarco criticized the administration for not notifying the council of the county’s financial challenges until October. Filiaggi said voters in her district who contacted her opposed the tax plan by a vote of 10 or 20 to 1. DeMarco and Filiaggi are the only Republicans on the board.
Bonaroti, a Democrat, said raising taxes more than necessary could cost his party in next year’s council elections, potentially leading to a future rollback of measures included in Tuesday’s budget.
Catena said this year’s budget was “the most difficult since the county council was created” in 2000.
“I’m not saying the sky will fall because me and my colleagues may be different,” Catena added. “Sometimes we may disagree, but we want to move the county forward.”
Tax increase considered inevitable
Nearly every side in the two-month dispute conceded that some level of tax increase is necessary – though most opposed Innamorato’s request for 2.2 million miles, which would raise the county’s millage rate by about 46%.
The county did not raise taxes at all during the entire 12-year term of former Executive Director Rich Fitzgerald, who governed from 2012 to 2023. This was sustainable even though the county’s assessed value increased every year, but the impact of the Covid-19 pandemic on commercial real estate put an end to this and the county has been running a deficit for the past few years.
“The agreed budget will begin to alleviate the fiscal challenges we inherited from the previous administration,” Innamorato said.
Rep. Hallam, a Democrat, said Innamorato “inherited a huge mess” from her predecessor.
“Nobody wants to raise taxes, but we had to,” Hallam said Tuesday. “The county really can’t function this year without a tax increase.”
Hallam predicted that a 1.7 mile increase, rather than a smaller increase, would prevent the need for another increase next year.
Funding for social services has been restored
The key difference between Innamorato’s original proposal and the council’s rejection concerned the Allegheny County Department of Human Services [ACDHS] — by far the largest county department and one of the most far-reaching, providing services to the county’s most vulnerable residents.
The council’s counterproposal budgeted $23 million less for the department than Innamorato’s budget, although the difference was mainly attributed to state matching funds. Of that $23 million, most would come from state matching funds, which are provided on a 4-to-1 ratio, county budget officials say.
Some councilors, including Grzybek, decried the cut, likening it to an employee leaving a generous 401(k) match on the table.
The compromise budget restores almost all of the ACDHS funding requested by Innamorato.
ACDHS leadership raised the alarm in November, warning that the council’s failure to follow Innamorato’s proposal could lead to cuts in work related to violence prevention, child welfare services, emergency shelters, eviction prevention and more.
Catena criticized the administration for “fear-mongering” into adopting budget priorities, pointing to an overall increase in the ACDHS budget, although much smaller than originally projected.
In November, dozens of social service providers lobbied the council to restore funding, and some returned on Tuesday to thank members for doing so.
Another key point of contention was how much to put into the rainy day fund. After recent deficits nearly depleted the fund, Innamorato proposed setting aside $33 million this year. The compromise proposal envisages allocating $23 million to the fund.
Other features of a compromise budget:
- Nearly every department will have a larger budget than in 2024, with the exception of petite reductions for county offices, court records and property assessments; and greater reductions for youth courts and the County Council
- A slight increase in information technology spending compared to the $4.5 million increase requested by Innamorato
- A $2.5 million increase for Children’s Initiatives, half of what Innamorato budgeted
- No increase in county homestead tax exemption. Innamorato’s proposal included an increase from $18,000 to $21,000.
Charlie Wolfson is a local government reporter for PublicSource. He can be contacted at [email protected].
This article appeared for the first time Public source and is republished here under a Creative Commons license.
