The Financially Distressed Municipalities Act (Act of 1987, P.L. 246, No. 47), also known as Act 47, is a Pennsylvania statute outlining procedures to stabilize municipalities in Pennsylvania undergoing financial distress. The Act empowers the Pennsylvania Department of Community and Economic Development to declare certain municipalities as financially distressed. It provides for the restructuring of debt of financially distressed municipalities, limits the ability of financially distressed municipalities to obtain government funding; authorizes municipalities to participate in federal debt adjustment actions and bankruptcy actions under certain circumstances; and provides for consolidation or merger of contiguous municipalities to relieve financial distress.
History Most provisions of Act 47 initially remained suspended until the termination of the Pennsylvania Intergovernmental Cooperation Act (Section 708 of Act 1991, June 5, P.L. 9, No 6).
The cities of Erie and Altoona, among others, have narrowly avoided Act 47 designation. Their mayors seek legislative changes to the binding arbitration rules of Act 111, as well as a reduction in the designation of tax-exempt properties, to improve their financial health.
Benefits of Act 47 Although some municipalities (listed in the chart below) have had the Financially Distressed designation removed, most cannot afford to lose the benefits Act 47 provides. The benefits include revenue from the nonresident wage tax available only to cities with Act 47 status.
Distressed municipalities The following municipalities were designated as part of the Municipalities Financial Recovery Program as of the date indicated. Any dates of imposition and lifting of sanctions, and the rescinding of the initial designation are also noted.
Municipality County Designated Sanctioned Sanction rescinded Designation rescinded Aliquippa Beaver December 22, 1987December 1, 2023 Altoona Blair April 1, 2012 September 13, 2017 Ambridge Beaver April 10, 1990 April 16, 1993 Braddock Allegheny June 15, 1988 July 19, 2023 Chester Delaware April 6, 1995 Clairton Allegheny January 19, 1988 November 24, 2015 Colwyn Delaware May 6, 2015 April 29, 2022 Duquesne Allegheny June 20, 1991October 15, 2023 East Pittsburgh Allegheny November 13, 1992 December 27, 1999 Farrell Mercer November 12, 1987February 8, 2019 Franklin Cambria July 26, 1988 January 31, 2023 Greenville Mercer May 8, 2002 November 9, 2023 Harrisburg Dauphin October 20, 2010 Homestead Allegheny March 22, 1993 March 28, 2007 Johnstown Cambria August 21, 1992April 28, 2023WTAJ-TV https://www.wtaj.com/news/local-news/johnstowns-status-of-distressed-ends-after-more-than-30-years/Mahanoy CitySchuylkillFebruary 18, 2016February 23, 2023 Millbourne Delaware January 7, 1993March 11, 2014 Nanticoke Luzerne May 26, 2006 May 3, 2016 New Castle Lawrence January 5, 2007 December 12, 2023NewvilleCumberlandAugust 9, 2023 North Braddock Allegheny May 22, 1995 April 11, 2003 Pittsburgh Allegheny December 29, 2003 February 12, 2018 Plymouth Luzerne July 27, 2004May 3, 2016 Rankin Allegheny January 9, 1989 May 24, 2023 Reading Berks October 14, 2009 July 14, 2022 Scranton Lackawanna January 10, 1992 January 1, 1999 November 22, 2002January 25, 2022ShamokinNorthumberlandJune 16, 2014August 20, 2024 Shenandoah Schuylkill May 20, 1988 April 16, 1993 West Hazleton Luzerne March 27, 2003October 21, 2014 Westfall Pike April 14, 2009October 12, 2014 Wilkinsburg Allegheny January 19, 1988 November 10, 1998 List of Act 47 Municipalities
References
External links Municipalities Financial Recovery Act, Third Edition, January 2001 Pittsburgh Act 47 Plan