Pittsburgh Controller Lamb questions outgoing Mayor Peduto's federal relief proposal

Jun. 30—Pittsburgh's top fiscal watchdog Wednesday questioned the timing of a four-year plan released Monday by outgoing Mayor Bill Peduto's administration for the city's $335 million federal pandemic relief money.

"I think it's premature for the mayor to suggest a four-year spending plan when there's going to be a new mayor in six months," Controller Michael Lamb said.

He also questioned a $2.5 million proposed allocation to OnePGH which would fund a pilot guaranteed personal income program. OnePGH is a new standalone entity created by the administration in April that's been touted as a way for the city to receive more money from its tax-exempt nonprofit sector.

Lamb called the proposed allocation "problematic" because it was city funds going to an entity supposed to be funded by nonprofits.

"That's the one thing that jumps out to me," Lamb said.

He addressed the issue as he released his 2020 Popular Annual Financial Report, which gives a snapshot of Pittsburgh's financial position during the pandemic year.

Peduto, Pittsburgh council release proposed plan for $335 million in federal relief

The city has no choice but to move forward with a plan now, Peduto Chief of Staff Dan Gilman said.

"We can't sit idly by for the next six months," Gilman said.

He explained that the city needs the cash to fund operations this year, and the city produces budgets using a five-year plan. Because the federal funding requires the reopening of the budget, it means the money is budgeted over that span, he said.

If there was a delay in the allocations, the city would jeopardize not being able to fully spend the money by 2024 and might have to return it unused, Gilman said.

The plan is also preliminary and could be changed by a future mayor, with support of council.

"This is not written in stone," Gilman said.

As for the OnePGH funding, Gilman said it is the only way the city can legally fund a pilot program to provide a basic income subsidy to low-income Black women to see if such a program helps. The city is among several experimenting with universal basic income that are proposing use of American Rescue Plan funding to do so, Gilman said.

Earlier Wednesday, Pittsburgh City Council members set an online public meeting for 6 p.m. next Tuesday to gather input about the proposal.

More will be scheduled so residents and community groups can provide input before the allocations are approved, council President Theresa Kail-Smith said.

"This is not a slush fund of dollars that can just be spent on pet projects," Councilman Ricky Burgess said. "The vast majority of these dollars are streamlined and are going to be used for very specific things."

The money is part of the $1.9 trillion American Rescue Plan that is designed to help the country recover from the effects of the coronavirus pandemic. In Pittsburgh, more than half of the cash will go toward helping to offset the fiscal impacts of the pandemic.

Had the money not come through, the city planned 600 layoffs because it would have lacked the money to pay them.

The framework for how the money will be used was drafted with input from the Pittsburgh Recovery Task Force, a group that included Kail-Smith, Burgess and Councilman R. Daniel Lavelle along with members of the Peduto administration.

In addition to restoring funds lost because of decreased tax revenues in the pandemic, the proposed allocations include $7 million for the Avenues of Hope program of the city's Urban Redevelopment Authority, which aims to revitalize business corridors in the city's Black neighborhoods.

The plan also includes $2 million for other development in Homewood, $1 million for the Jasmine Nyree Campus in Sheraden that helps people with special needs and $1 million for the Gladstone School affordable housing development in Hazelwood.

Next week, council will consider a $200,000 contract with North Shore-based accounting firm Maher Duessel to advise the city if its allocation plans meet federal guidelines and to account for the spending.

The process will also be audited by the controller's office, Lamb said.

Maher Duessel already does work for the city, but this will involve a separate team focused on the intricacies of meeting the stringent guidelines required by the American Rescue Plan, city Management and Budget Director Kevin Pawlos told council members.

The work is a "heavy lift" that will require the firm's help, Pawlos said.

The firm didn't immediately return messages seeking comment. Maher Duessel has formed a team with expertise in ensuring compliance with the law, Pawlos said, and it is advising several other government bodies to administer their allocations.

"The bulk of these funds are to put back the fixed costs that we delayed," because of the pandemic, Pawlos said.

Tom Davidson is a Tribune-Review staff writer. You can contact Tom at 724-226-4715, tdavidson@triblive.com or via Twitter .