(Pittsburgh) June 2, 2022   The Popular Annual Financial Report from the Allegheny County Controller’s office showed continuing strong economic indicators for the County, with a growing fund balance and major revenue streams rebounding from declines during the pandemic. But Acting Controller Tracy Royston warned in the report that the County must begin planning to address impending concerns such as the expiration of emergency federal funding, a focus on bridge repairs in the wake of the Fern Hollow Bridge collapse in February, and an increasingly unbalanced pension fund.

 Given these challenges, “it is time for the County to pursue a largely untapped source of revenue—our region’s largest ‘purely public charities,’” Royston wrote. Citing a report released earlier this month by her office in conjunction with the office of City of Pittsburgh Controller Michael Lamb, she wrote that “the five largest of these institutions own more than $5 billion in currently untaxed property in the County. If taxed at 50 percent of its value (the level of existing agreements for payments to Erie County), this would raise $11.5 million annually for our government. I urge the County administration to pursue equitable agreements with these institutions to the benefit of all of our residents.”

The Popular Annual Financial Report is a distillation of the Annual Comprehensive Financial Report, the complete accounting of the County’s funds and component units, which was also released this week.

“Each year (and indeed every day), our dedicated team of financial professionals ensures that our policymakers, residents, and other interested parties know where the County stands on the important measures of financial health and in its funds and accounts. I am honored to have been given the opportunity of working with this team—as well as our auditors, systems managers, and analysts—to fulfill our government’s obligations of transparency and accountability,” Royston wrote.

The General Fund’s unassigned balance increased by $1.3 million to $51.8 million during 2021, remaining well over the recommended level of at least 5 percent of operating revenues at 6.7 percent. While the combined General and Debt Service funds grew by $5.1 million to $111.2 million, funds from the American Rescue Plan Act of 2021 (ARPA) contributed $12.5 million. With over $800 million in emergency aid received by the County set to be exhausted in 2024, the County must plan to maintain fiscal stability as well as support crucial programs which these funds have bolstered, including Human Services (about $40 million through 2021). “Challenges such as providing essential human services, creating and maintaining affordable housing, alleviating adverse environmental conditions in some of our most disadvantaged communities, and supporting transportation and infrastructure will persist well after these funds have expired,” Royston wrote.

Overall revenue increased by over $20 million. Major sources such as Property Tax (up $11 million) and Sales Tax (up $7 million) showed significant increases. Charges for Services grew by $2 million thanks to increases in deed filings, utilization of County Police at Pittsburgh International Airport, and use of County Parks facilities. However, these increases were largely  offset by continued population declines at the County’s Kane Regional Centers, which fell to 678 in 2021 from 813 in 2020. The population had not been below 925 for at least the preceding 10 years.

The Transit Fund derived from the Drink and Vehicle Rental taxes, which supports the County’s annual local match for state funding of the Port Authority, saw revenue increase over $17 million after it fell by more than half between 2019 and 2020. The local match was made using emergency federal funds in 2020 due to this steep decline. Drink Tax receipts rebounded by more than $16 million to about 80 percent of pre-pandemic 2019 receipts. Vehicle Rental Tax receipts rebounded by about $700,000, though they remained more than $2 million below 2019.

Expenditures increased by over $39 million overall, led by increased utilization of Human Services programming ($19 million), reductions in federal reimbursements for staffing across several departments, $3 million for a 911 Call Center console, and $1.2 million for heating and energy projects in the County Jail.

While debt decreased by over $30 million from 2020, debt levels must be monitored as the County focuses on repairing or replacing 27 of its bridges rated in poor condition. “I have been encouraged by the County’s openness on the condition of its bridges and its disclosure of its plans to address each bridge rated in poor condition. The construction inspection team of the Controller’s office will monitor each of these projects for compliance with specifications, as it does all construction contracts entered into by the County,” Royston wrote.

Royston also urged a focus on the welfare of the County workforce as the COVID-19 pandemic continues to ebb and flow. “Concerns have abounded from workers in essential areas such as the Jail and 911 Call Center about staffing shortages and work conditions. To maintain and attract workers and ensure safety in these crucial areas, these concerns must be addressed,” she wrote.

The retirement security of current workers must also be considered, as the funded status of the pension fund fell again to just 32.4 percent, with 80 percent being considered “healthy” by rating agencies.

“At the moment, there is a growing imbalance between workers contributing to and drawing from our pension system. The County can take steps to address this issue by hiring additional employees to alleviate a reliance on overtime in some departments and returning some portion of its hundreds of contracted workers to the payroll,” Royston wrote.

“By looking forward and planning conscientiously to address our outstanding challenges, Allegheny County can bolster the prospects of all of its residents and give confidence to all those considering investments in our communities. As part and parcel of these efforts, the Controller’s office will continue to monitor every dollar spent and provide the information necessary to assess our fiscal position and the performance of our government.”

View the Popular Annual Financial Report

View interactive charts and graphs

View the Annual Comprehensive Financial Report