On June 26th 2015, the mayor of Pittsburgh, Bill Peduto has threatened to take legal action against an authority that is the overseer of the city finances. The mayor is demanding that $11.4 million of gambling money is released by July.
Paul Leger, the City Finance Director has accused the Intergovernmental Cooperation Authority of withholding money illegally since 2014. This has then caused harm in regards to the city’s ability to make debt payments and to make pension payments.
A minimum of $10 million is given to Pittsburgh from the state each year from casino gambling proceeds. This is due to Pittsburgh being one of the state casino system host cities. The ICA controls the release of the money under the state law.
Peduto went on to say that they have until the 1st of July. He also said that the ICA does not have the authority to say how the city is allowed to spend the money and has also accused the ICA of creating their own little government by withholding the money.
Henry Sciortino, the ICA Executive Director said that this is wrong and that they have never released the money for any other purpose then what is said in the statue which governs the use of the money from gaming.
According to the state gambling law, Pittsburgh is able to use the money for debt service and employee pension payouts as well as other purposes that are considered to be in the interest of the city by intergovernmental corporation authority. The ICA is withholding the money, until Pittsburgh has created an in-house electronic system that is able to track employee payroll.
Peduto and Lamb have said that the authority had overstepped their bounds as they approved the conditional release of $2.5 million that is to be used for police, paramedic stations, fire and cyber security measures upgrades. The money will be placed in escrow accounts and will only be released on the completion of the work.
Lamb said that it is not appropriate for them to take money from the operating budget and move it to the capital budget.
Peduto also said that he has not seen an accounting of the gambling funds and is also questioning if the ICA is giving the city the interest that it earns.
A former ICA board treasurer, Ann Dugan has said that the ICA should invest the money or they should direct the money to the city pension accounts.