Allentown Managing Director McMahon abruptly departs
Joseph M. McMahon III, Allentown’s managing director for the past two years, no longer works for the city, Mayor Ray O’Connell confirmed Thursday.
McMahon, who served the city for more than 25 years, departed this week. O’Connell declined to say whether McMahon resigned or was terminated, calling it a personnel matter.
McMahon’s abrupt exit followed an argument with O’Connell during a meeting Monday on the in-progress 2021 budget, according to a city official.
McMahon wasn’t available to comment Thursday.
The managing director position is a key bureaucratic role second in the city hierarchy behind the mayor. O’Connell nominated McMahon in May 2018, about five weeks after O’Connell was appointed interim mayor. City Council confirmed McMahon two weeks later, filling a position that had sat vacant for more than two years.
McMahon’s departure comes three weeks before the O’Connell administration is expected to deliver a proposed 2021 budget to City Council. O’Connell is also without a finance director, having yet to replace Brent Hartzell, who left in February for a job in Texas.
O’Connell, elected to a two-year term as mayor last year, said he didn’t have a specific date by which he hopes to nominate a new managing director. In the meantime, he said he was confident he could work with the remainder of his Cabinet as well as City Council to adopt a budget with no tax hike.
“My department heads and bureau managers are top-notch,” he said. “We have a great relationship and an open dialogue, and we will move forward together.”
Daryl Hendricks, City Council president, also was optimistic that budget season would “go very smoothly.”
“Joe McMahon was only one person,” Hendricks said. “Though he was overseeing a lot of what’s going on, I believe the bureau heads are very competent and will do a fine job.”
McMahon replaced Francis Dougherty, who resigned in 2016 amid scrutiny from federal investigators. Dougherty pleaded guilty one year later to a count of conspiracy to commit mail and wire fraud, and was a key witness for the prosecution during Mayor Ed Pawlowski’s federal trial in March 2018. Pawlowski was convicted of 47 counts for his role in several pay-to-play corruption schemes that traded city contracts for campaign donations. He resigned that same month and is serving a 15-year prison term.
McMahon spent 23 years with the city’s water and sewer department before moving to the Lehigh County Authority, where he spent seven years. Before returning to the city, he also served as manager of the Whitehall Township Authority.
In recent months, O’Connell has credited McMahon with playing an integral role in managing city operations during the COVID-19 pandemic. Heand City Council also commended McMahon for his efforts negotiating a settlement deal with LCA involving numerous disputes related to the authority’s 50-year lease of the city’s water and sewer systems.
McMahon’s salary was $116,688.
In the early days of the pandemic, Allentown braced for a 2020 budget deficit exceeding $10 million. But through August, tax revenue collection is only lagging 4% year-over-year, and the finance department now estimates a total revenue shortfall of $4 million. With expenses also coming in under budget as a result of furloughs and other cost-cutting measures, the city now anticipates a $367,000 yearend deficit, interim Finance Director Jessica Baraket told City Council on Wednesday night.
O’Connell said Thursday he’s also asked each department head to slash 2021 nonpersonnel budgets an additional 5%.
City Council’s budget and finance committee on Wednesday advanced legislation creating a new position of deputy finance director for a full council vote in October. An independent consulting firm that conducted a management and financial audit last year recommended the city create the position so the finance director would have more time implementing longer-term strategic and financial initiatives and “negotiating much needed personnel cost reforms.”
The upcoming budget season will feature new rules following voter-approved changes to the city’s home rule charter.
Previously, the mayor’s proposed budget was adopted by default if council failed to adopt a budget by Dec. 15. Now the default budget option has been eliminated, creating the possibility of a government shutdown if council can’t agree on a budget by Dec. 31.
Because of another charter amendment, the seven-member council now only needs four votes instead of five to adopt a budget even if it includes a tax hike or tax cut.