Financially Distressed Municipalities Act
Encyclopedia
The Financially Distressed Municipalities Act (Act of 1987, P.L. 246, No. 47), also known as Act 47, 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.
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.
Pennsylvania Department of Community and Economic Development
Pennsylvania Department of Community and Economic Development is a cabinet-level state agency in Pennsylvania.The Financially Distressed Municipalities Act , also known as Act 47, empowers the Pennsylvania Department of Community and Economic Development to declare certain municipalities in...
to declare certain municipalities
Municipality
A municipality is essentially an urban administrative division having corporate status and usually powers of self-government. It can also be used to mean the governing body of a municipality. A municipality is a general-purpose administrative subdivision, as opposed to a special-purpose district...
as financially distressed
Financial distress
Financial distress is a term in Corporate Finance used to indicate a condition when promises to creditors of a company are broken or honored with difficulty. Sometimes financial distress can lead to bankruptcy...
. It provides for the restructuring of debt
Debt restructuring
Debt restructuring is a process that allows a private or public company – or a sovereign entity – facing cash flow problems and financial distress, to reduce and renegotiate its delinquent debts in order to improve or restore liquidity and rehabilitate so that it can continue its...
of financially distressed municipalities, limits the ability of financially distressed municipalities to obtain government funding; authorizes municipalities to participate in Federal debt adjustment
Debt adjustment
Debt adjustment is a form of debt relief that allows a government, organization, corporation, or individual to repay a debt over a longer period of time and with smaller payment amounts than the lender and borrower originally agreed upon. It is an alternative to bankruptcy...
actions and bankruptcy
Bankruptcy
Bankruptcy is a legal status of an insolvent person or an organisation, that is, one that cannot repay the debts owed to creditors. In most jurisdictions bankruptcy is imposed by a court order, often initiated by the debtor....
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
Erie, Pennsylvania
Erie is a city located in northwestern Pennsylvania in the United States. Named for the lake and the Native American tribe that resided along its southern shore, Erie is the state's fourth-largest city , with a population of 102,000...
and Altoona
Altoona, Pennsylvania
-History:A major railroad town, Altoona was founded by the Pennsylvania Railroad in 1849 as the site for a shop complex. Altoona was incorporated as a borough on February 6, 1854, and as a city under legislation approved on April 3, 1867, and February 8, 1868...
, 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
No city has emerged from Act 47 status partially because of the benefits. The benefits include:- Revenue from the nonresident wage tax which is not available to cities unless they have 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 Aliquippa, Pennsylvania Aliquippa is a city in Beaver County, Pennsylvania, United States, within the Pittsburgh metropolitan area. The population was 9,438 at the 2010 census. Formerly a borough, it was formally named a city in 1987 by the Aliquippa Council.-History:... |
Beaver Beaver County, Pennsylvania -Demographics:As of the census of 2000, there were 181,412 people, 72,576 households, and 50,512 families residing in the county. The population density was 418 people per square mile . There were 77,765 housing units at an average density of 179 per square mile... |
December 22, 1987 | |||
| Ambridge Ambridge, Pennsylvania Ambridge is a borough in Beaver County in Western Pennsylvania, incorporated in 1905 and named after the American Bridge Company. Ambridge is located 16 miles northwest of Pittsburgh, alongside the Ohio River. In 1910, 5,205 people lived in Ambridge; in 1920, 12,730 people lived there, and in... |
Beaver Beaver County, Pennsylvania -Demographics:As of the census of 2000, there were 181,412 people, 72,576 households, and 50,512 families residing in the county. The population density was 418 people per square mile . There were 77,765 housing units at an average density of 179 per square mile... |
April 10, 1990 | April 16, 1993 | ||
| Braddock | Allegheny Allegheny County, Pennsylvania Allegheny County is a county in the southwestern part of the U.S. state of Pennsylvania. As of the 2010 census, the population was 1,223,348; making it the second most populous county in Pennsylvania, following Philadelphia County. The county seat is Pittsburgh... |
June 15, 1988 | |||
| Chester Chester, Pennsylvania Chester is a city in Delaware County, Pennsylvania, United States, with a population of 33,972 at the 2010 census. Chester is situated on the Delaware River, between the cities of Philadelphia and Wilmington, Delaware.- History :... |
Delaware Delaware County, Pennsylvania Delaware County is a county located in the U.S. state of Pennsylvania. As of 2010, the population was 558,979, making it Pennsylvania's fifth most populous county, behind Philadelphia, Allegheny, Montgomery, and Bucks counties.... |
April 6, 1995 | |||
| Clairton Clairton, Pennsylvania Clairton is a city in Allegheny County, Pennsylvania, United States, along the Monongahela River. It is part of the Pittsburgh Metropolitan Area. The population was 6,796 at the 2010 census. Under Pennsylvania legal classifications for local governments, Clairton is considered a third-class city... |
Allegheny Allegheny County, Pennsylvania Allegheny County is a county in the southwestern part of the U.S. state of Pennsylvania. As of the 2010 census, the population was 1,223,348; making it the second most populous county in Pennsylvania, following Philadelphia County. The county seat is Pittsburgh... |
January 19, 1988 | |||
| Duquesne Duquesne, Pennsylvania Duquesne is a city along the Monongahela River in Allegheny County, Pennsylvania, United States, and is part of the Pittsburgh Metropolitan Area. The population was 5,565 at the 2010 census.-History:... |
Allegheny Allegheny County, Pennsylvania Allegheny County is a county in the southwestern part of the U.S. state of Pennsylvania. As of the 2010 census, the population was 1,223,348; making it the second most populous county in Pennsylvania, following Philadelphia County. The county seat is Pittsburgh... |
June 20, 1991 | |||
| East Pittsburgh East Pittsburgh, Pennsylvania East Pittsburgh is a borough in Allegheny County, Pennsylvania, about southeast of the confluence of the Monongahela and the Allegheny rivers at Pittsburgh. The population in 1900 stood at 2,883, and in 1910, at 5,615. As of the 2010 census, the borough population was 1,822, having fallen from... |
Allegheny Allegheny County, Pennsylvania Allegheny County is a county in the southwestern part of the U.S. state of Pennsylvania. As of the 2010 census, the population was 1,223,348; making it the second most populous county in Pennsylvania, following Philadelphia County. The county seat is Pittsburgh... |
November 13, 1992 | December 27, 1999 | ||
| Farrell Farrell, Pennsylvania Farrell is a city in Mercer County, Pennsylvania, United States. The population was 6,050 at the 2000 census. It is part of the Youngstown–Warren–Boardman, OH-PA Metropolitan Statistical Area.-History:... |
Mercer Mercer County, Pennsylvania Mercer County is a county located in the U.S. state of Pennsylvania. As of 2010, the population was 116,638. Its county seat is Mercer; Sharon is its largest city.... |
November 12, 1987 | |||
| Franklin | Cambria Cambria County, Pennsylvania Cambria County is a county located in the U.S. state of Pennsylvania. It comprises the Johnstown, Pennsylvania, Metropolitan Statistical Area. As of 2010, the population was 143,679.... |
July 26, 1988 | |||
| Greenville Greenville, Pennsylvania Greenville is a borough in Mercer County, Pennsylvania. Located along the Shenango River, Greenville is roughly 80 miles from both Pittsburgh and Cleveland. Greenville is part of the Youngstown–Warren–Boardman, OH-PA Metropolitan Statistical Area, which is home to 570,000 people... |
Mercer Mercer County, Pennsylvania Mercer County is a county located in the U.S. state of Pennsylvania. As of 2010, the population was 116,638. Its county seat is Mercer; Sharon is its largest city.... |
May 8, 2002 | |||
| Harrisburg Harrisburg, Pennsylvania Harrisburg is the capital of Pennsylvania. As of the 2010 census, the city had a population of 49,528, making it the ninth largest city in Pennsylvania... |
Dauphin County Dauphin County, Pennsylvania Dauphin County is a county in the U.S. state of Pennsylvania and is one of the three counties comprising the Harrisburg–Carlisle Metropolitan Statistical Area. As of 2010 census, the population was 268,100. The county includes the city of Harrisburg, which has served as the state capital... |
October 20, 2010 | |||
| Homestead Homestead, Pennsylvania Homestead is a borough in Allegheny County, Pennsylvania, USA, in the "Mon Valley," southeast of downtown Pittsburgh and directly across the river from the city limit line. The borough is known for the Homestead Strike of 1892, an important event in the history of labor relations in the United... |
Allegheny Allegheny, Pennsylvania Allegheny City was a Pennsylvania municipality located on the north side of the junction of the Allegheny and Ohio rivers, across from downtown Pittsburgh. It was annexed by Pittsburgh in 1907... |
March 22, 1993 | March 28, 2007 | ||
| Johnstown Johnstown, Pennsylvania Johnstown is a city in Cambria County, Pennsylvania, United States, west-southwest of Altoona, Pennsylvania and east of Pittsburgh. The population was 20,978 at the 2010 census. It is the principal city of the Johnstown, Pennsylvania, Metropolitan Statistical Area, which includes Cambria County... |
Cambria Cambria County, Pennsylvania Cambria County is a county located in the U.S. state of Pennsylvania. It comprises the Johnstown, Pennsylvania, Metropolitan Statistical Area. As of 2010, the population was 143,679.... |
August 21, 1992 | |||
| Millbourne Millbourne, Pennsylvania Millbourne is a borough in Delaware County, Pennsylvania, United States. The population was 1159 at the 2010 census. Millbourne borders Philadelphia along Cobbs Creek... |
Delaware Delaware County, Pennsylvania Delaware County is a county located in the U.S. state of Pennsylvania. As of 2010, the population was 558,979, making it Pennsylvania's fifth most populous county, behind Philadelphia, Allegheny, Montgomery, and Bucks counties.... |
January 7, 1993 | |||
| Nanticoke Nanticoke, Pennsylvania Nanticoke is a city in Luzerne County, Pennsylvania, United States. The population was 10,465 at the 2010 census.-History:The name Nanticoke was derived from Nantego, the Indian tidewater people who moved here when their Maryland lands were spoiled for hunting by the colonial settlement in... |
Luzerne Luzerne County, Pennsylvania - Demographics :As of the 2010 census, the county was 90.7% White, 3.4% Black or African American, 0.2% Native American, 1.0% Asian, 3.3% were of some other race, and 1.5% were two or more races. 6.7% of the population was of Hispanic or Latino ancestry... |
May 26, 2006 | |||
| New Castle New Castle, Pennsylvania New Castle is a city in Lawrence County, Pennsylvania, United States, northwest of Pittsburgh and near the Pennsylvania-Ohio border just east of Youngstown, Ohio; in 1910, the total population was 36,280; in 1920, 44,938; and in 1940, 47,638. The population has fallen to 26,309 according to the... |
Lawrence Lawrence County, Pennsylvania Lawrence County is a county located in the U.S. state of Pennsylvania. In 2010, its population was 91,108. The county was added to the Pittsburgh Metropolitan Statistical Area in 2003. The county seat is New Castle.... |
January 5, 2007 | |||
| North Braddock North Braddock, Pennsylvania North Braddock is a borough in Allegheny County, Pennsylvania, United States. North Braddock was organized from a part of Braddock Township in 1897. North Braddock is a suburb east of Pittsburgh with a 15-minute travel time to the city... |
Allegheny Allegheny County, Pennsylvania Allegheny County is a county in the southwestern part of the U.S. state of Pennsylvania. As of the 2010 census, the population was 1,223,348; making it the second most populous county in Pennsylvania, following Philadelphia County. The county seat is Pittsburgh... |
May 22, 1995 | April 11, 2003 | ||
| Pittsburgh Pittsburgh, Pennsylvania Pittsburgh is the second-largest city in the US Commonwealth of Pennsylvania and the county seat of Allegheny County. Regionally, it anchors the largest urban area of Appalachia and the Ohio River Valley, and nationally, it is the 22nd-largest urban area in the United States... |
Allegheny Allegheny County, Pennsylvania Allegheny County is a county in the southwestern part of the U.S. state of Pennsylvania. As of the 2010 census, the population was 1,223,348; making it the second most populous county in Pennsylvania, following Philadelphia County. The county seat is Pittsburgh... |
December 29, 2003 | |||
| Plymouth Plymouth, Pennsylvania Plymouth is an incorporated borough in Luzerne County, Pennsylvania, United States 4 miles west of Wilkes Barre, on the Susquehanna River. Prior to its incorporation in 1866, it was part of Plymouth Township, established in 1769 by the Susquehanna Company and claimed by Connecticut based on... |
Luzerne Luzerne County, Pennsylvania - Demographics :As of the 2010 census, the county was 90.7% White, 3.4% Black or African American, 0.2% Native American, 1.0% Asian, 3.3% were of some other race, and 1.5% were two or more races. 6.7% of the population was of Hispanic or Latino ancestry... |
July 27, 2004 | |||
| Rankin Rankin, Pennsylvania Rankin is a borough in Allegheny County, Pennsylvania, United States, south of Pittsburgh on the Monongahela River. Early in the 20th century, Rankin specialized in manufacturing steel and wire goods... |
Allegheny Allegheny County, Pennsylvania Allegheny County is a county in the southwestern part of the U.S. state of Pennsylvania. As of the 2010 census, the population was 1,223,348; making it the second most populous county in Pennsylvania, following Philadelphia County. The county seat is Pittsburgh... |
January 9, 1989 | |||
| Reading Reading, Pennsylvania Reading is a city in southeastern Pennsylvania, USA, and seat of Berks County. Reading is the principal city of the Greater Reading Area and had a population of 88,082 as of the 2010 census, making it the fifth most populated city in the state after Philadelphia, Pittsburgh, Allentown and Erie,... |
Berks Berks County, Pennsylvania -Demographics:As of the census of 2000, there were 373,638 people, 141,570 households, and 98,532 families residing in the county. The population density was 435 people per square mile . There were 150,222 housing units at an average density of 175 per square mile... |
October 14, 2009 | |||
| Scranton Scranton, Pennsylvania Scranton is a city in the northeastern part of Pennsylvania, United States. It is the county seat of Lackawanna County and the largest principal city in the Scranton/Wilkes-Barre metropolitan area. Scranton had a population of 76,089 in 2010, according to the U.S... |
Lackawanna Lackawanna County, Pennsylvania As of the census of 2000, there were 213,295 people, 86,218 households, and 55,783 families residing in the county. The population density was 465 people per square mile . There were 95,362 housing units at an average density of 208 per square mile... |
January 10, 1992 | January 1, 1999 | November 22, 2002 | |
| Shenandoah Shenandoah, Pennsylvania Shenandoah is a small town located in the lower part of the anthracite Coal Region, Schuylkill County, Pennsylvania. It is northwest of Philadelphia. The Greater Shenandoah area includes Shenandoah Heights, which is part of West Mahanoy Township and is located just north of Shenandoah.-History:The... |
Schuylkill Schuylkill County, Pennsylvania -Notable people:*Boxing heavyweight great Muhammad Ali had his training camp in Deer Lake.*Charles Justin Bailey, commanding general of the 81st Division in World War I, was born in Tamaqua on June 21, 1859.... |
May 20, 1988 | April 16, 1993 | ||
| West Hazleton West Hazleton, Pennsylvania West Hazleton, founded by Conrad Horn, is a borough in Luzerne County, Pennsylvania, south of Wilkes Barre. In 1900, 2,516 people lived here; in 1910, 4,715 people lived here. The population was 4,594 at the 2010 census... |
Luzerne Luzerne County, Pennsylvania - Demographics :As of the 2010 census, the county was 90.7% White, 3.4% Black or African American, 0.2% Native American, 1.0% Asian, 3.3% were of some other race, and 1.5% were two or more races. 6.7% of the population was of Hispanic or Latino ancestry... |
March 27, 2003 | |||
| Westfall Westfall Township, Pennsylvania Westfall Township is a township in Pike County, Pennsylvania, United States. The population was 2,323 at the 2010 census.-Geography:According to the United States Census Bureau, the township has a total area of 29.4 square miles , of which, 28.8 square miles of it is land and... |
Pike Pike County, Pennsylvania -National protected areas:* Delaware Water Gap National Recreation Area * Middle Delaware National Scenic River * Upper Delaware Scenic and Recreational River -Demographics:... |
April 14, 2009 | |||
| Wilkinsburg Wilkinsburg, Pennsylvania Wilkinsburg is a borough in Allegheny County, Pennsylvania, United States adjacent to the city of Pittsburgh. The population was 15,930 at the 2010 census, having lost more than 13,000 in the 70 years since 1940, when 29,853 people were enumerated... |
Allegheny Allegheny County, Pennsylvania Allegheny County is a county in the southwestern part of the U.S. state of Pennsylvania. As of the 2010 census, the population was 1,223,348; making it the second most populous county in Pennsylvania, following Philadelphia County. The county seat is Pittsburgh... |
January 19, 1988 | November 10, 1998 | ||