David J. Malone: 'While time is of the essence, not just any recovery plan will do'

Sunday, November 16, 2003

It is time that "Pittsburghers" from all over southwestern Pennsylvania recognize that our region cannot prosper without a strong core.

In a few short months the city of Pittsburgh's fiscal crisis has already damaged the entire region's image as a place to do business. The city's finances have garnered national and international pres. Outside business investors are expressing concern about the region's health, and local business leaders and residents are expressing uncertainty about the region's future. Failure to quickly rectify fiscal instability will only continue to impede southwestern Pennsylvania's business outlook and the region's ability to attract and retain a high-caliber work force.

As a private sector-led board concerned with work force development, the Three Rivers Workforce Investment Board understands that business confidence translates to economic development and jobs for the region. To preserve the region's businesses, employment opportunities and work force, the city's financial health must be restored and a long-term recovery plan must be adopted without delay. Mayor Murphy recently sought "distressed communities" designation, making Pittsburgh the largest city in Pennsylvania to seek protection. Further delay of a solution could end in a municipal bankruptcy filing which would haunt the region for decades.

While time is of the essence, not just any recovery plan will do. The solution must not make the Pittsburgh area any less attractive to new or existing businesses. As Pittsburgh's civic community has recognized in recent years through sizable investments in efforts to boost Pittsburgh's national reputation -- image matters.

As with other places around the country, the Pittsburgh region's image is dictated by the reputation of its central city. People outside the region are unlikely to recognize any of southwestern Pennsylvania's counties. It is Pittsburgh, and all of its associated qualities, that people recognize. Designation as a "distressed community" could harm the region's image, making it unattractive for business and workforce attraction and retention; filing for municipal bankruptcy would most certainly result in this unfortunate outcome. Further demise of the region's image will prove counterproductive to the hard work of work force development and economic development agencies to strengthen the region's economy and to expand the opportunities for the work force.

Image is not the only factor that will impact jobs. If Pittsburgh's credit rating continues to drop, it will become increasingly difficult for the city to borrow money, in turn jeopardizing direct and indirect jobs created through city projects as well as new economic development in general. A fiscal recovery plan must take this issue into account.

Finally, the recovery plan must promote financial strategies grounded in an understanding of the interconnectedness between the region and its core. The city's financial solvency is critical to the entire region's economic vitality, not just Pittsburgh's urban core. Regional stakeholders have the capacity to solve this problem and should continue to pursue a locally grown solution. The city has made a commitment to streamlining its budget and restoring financial stability.

It must be held to this commitment, but it is up to the region's elected officials, civic leaders, businesses and residents, not just those of the city of Pittsburgh, to push for a solution that will restore fiscal solvency without sacrificing the region's image. Suburban communities in southwestern Pennsylvania have a stake in resolving the underlying structural imbalances that threaten businesses and jobs throughout the region and must be willing to become part of the solution.