Pa.’s small towns cautiously optimistic after pandemic
There’s a bipartisan bill percolating in the Senate that would inject $500 billion into state and local government coffers depleted by COVID-19.
Proponents of the bill, as well as national media outlets, are raising a racket about small-town America, claiming that lack of infrastructure and emergency preparedness would lead to devastating and lasting impacts from the pandemic. Predictions ranged from deep cuts to emergency services and public safety to economic collapse and hospitals being overrun with coronavirus patients, with one April New York Times headline proclaiming “This is Going to Kill SmallTown America.”
To date, federal COVID-19 relief aid has been reserved for metropolitan areas with more than 500,000 residents. How are smaller cities surrounding Pittsburgh fairing as counties flip into the “green phase” of the state reopening plan?
“Well, we’re getting more complaints about grass not being cut,” said Tom Smith, city council president in New Castle, Lawrence County, a financially distressed city with an estimated
population of about 21,000.
Officials in Beaver, Butler, Washington, Pa. and New Castle all indicated cautious optimism about their cities’ futures while acknowledging the pain in their communities, particularly of small businesses forced to shutter for the last several months.
Common themes of fear over lost revenue from Pennsylvania’s liquid fuel tax, which trickles down to local municipality budgets to fund road maintenance and projects, and diminished earned income tax revenue emerged front and center, but leaders are confident they won’t have to reduce services or raise taxes.
Randy Finfrock, city councilman in Greensburg, however, is less confident.
“The bottom line is that we’ll struggle but make it through this year,” he said. “Next year is the big question mark.”
None of these cities came anywhere near having their health systems overwhelmed by COVID-19 patients. City officials credited social distancing and precautionary measures for the low case numbers.
Mr. Smith said, in all seriousness, “the pandemic has had a significant impact” on both cities. The mayor of New Castle reduced staff and furloughed many public works employees, though no public safety workers were impacted. Furloughed employees are beginning to return, but unemployment remains much higher than in January.
Still, City Hall reopens June 15.
Mr. Smith didn’t have an exact figure yet, and hesitated to speculate, on how long it might take to return to a normal budget.
“Boy, if anyone out there can project these figures, I want their number,” he said. “I bet they could do the Mega [Millions] ball numbers, too.”
Beaver, a city with a population of around 4,200, also is likely to experience a ripple effect from liquid fuel tax decreases as well as business privilege taxes into the next year or two.
Police Chief and Borough Manager Dan Madgar said the city has been “fortunate” outside of the infamous hotspot at the Brighton Rehabilitation and Wellness Center nursing home, which hosted the worst COVID-19 outbreak in the state.
“Morale’s starting to bounce back,” Mr. Madgar said. “Small businesses are going to struggle to reopen, but Beaver is basically a service town with lots of doctors and attorneys. The courthouse is the biggest employer we have.”
Indeed, each of the five cities are county seats, which means their economies largely are professional service-based rather than industrial. They might not be representative of other small towns.
Mr. Madgar said other cities with meat plants or manufacturers deemed non-essential were particularly hard hit. Even hospitals furloughed or laid off staff due to lost revenue when elective surgeries were banned for a period.
Washington Hospital in the city of Washington, population about 13,600, is the city’s largest employer and laid off a significant portion of its workforce, said city councilman Joe Manning. Mr. Manning said Washington’s budget is on track until the end of the year, but in 2021, he’s anticipating significant shortfalls up to 25% on a roughly $14.7 million budget. To date, Washington hasn’t had to furlough any employees.
The city receives a chunk of its revenue from the Meadows Racetrack and Casino, which, like casinos around the country, was devastated. Mr. Manning said the council is “very concerned” about the lost gaming money.
“But our expenditures for COVID-19 haven’t been that great, and we haven’t been overrun,” he said.
In addition to the casino, fairs and festivals tend to drive revenue for towns like Washington and Beaver. Mr. Manning said the annual Whiskey Rebellion, which kicks off in July each year and draws at least 30,00040,000 people to downtown, has been canceled, as has the annual Protect Our Nation’s Youth (PONY) League world series, a transition league for Little League graduates that now draws kids from all over the world, including China, Taipei and Mexico.
“That’s a huge deal,” he said, adding a decision has yet to be made about the county fair in August.
Jeff Smith, a Butler city councilman, said the cancellation of such events would impact local businesses more than city coffers.
“If federal money becomes available, I think all municipalities have an obligation to investigate it,” he said. “Then again, maybe I’ve just become cynical, but after Philadelphia and Pittsburgh and state take their share of any funding, I don’t know how much will be left for us.”
Butler has a population of about 13,000, which makes it only slightly smaller than Greensburg, with its roughly 14,000 residents. Mr. Finfrock, of Greensburg, said the city has lost about $1.3 million on a $14 million budget. He said the city can juggle its budget to reduce about half of that loss this year, but if COVID-19 has a resurgence in the fall or next year, Greensburg will be forced to reduce its services, likely the police force.
Greensburg has one of the larger police forces in the area, which, along with pension obligations, chews through the majority of the city’s annual budget.
“I’m not in charge of the budget at this point,” he said. “The virus is.”
He described potential federal funding as “monopoly money” and added the city council would avoid raising taxes at all cost.
“The problem is we’ve got a Congress at the federal level that says ‘go bankrupt’ to small communities,” he said.
As more Pennsylvania counties have flipped into the green phase, businesses are beginning to reopen, but officials are concerned some have lost too much income to survive. And some might have realized they can get by with fewer employees than previously. Unemployment is likely to remain high for a period.
“I was out walking with my neighbor John — he’s retired — and I said ‘what an [screwed] up 2020,’” Mr. Madgar said. “And he said ‘no kidding.’ Here we are in June, and it’s not getting better yet. But it will.”