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Hazleton woes may become commonplace MARK GUYDISH OPINION

Thursday June 25, 2009 | 01:00 AM

It’s an epic 12 years in the making, at a cost of millions, with a cast of thousands (of taxpayers). It’s a saga of high rollers gambling on creative financing, of adversity overcome only to discover more adversity. Let’s call it “Law &Order: TVU (Taxpayer Victims Unit)”

For those who haven’t followed our long-running series, here’s a recap.

In 1997, Hazleton Mayor Mike “I’m the mayor, I can do that” Marsicano boosted the city police maximum pension from 50 to 75 percent of pay. In 2000, the state Auditor General ruled the increase violated state Act 205, which allows the city to levy a special tax to beef up its grossly underfunded pension plan, but also sets a maximum pension of 50 percent. That same year, Lou “Toothy Grin” Barletta took over the mayor’s office and declared the pension increase would bankrupt the city, and successfully got it mostly rolled back (some police kept the higher pension rate)

Thus Lou started his tenure by cleaning up a big pile of pension doo-doo left on the City Hall rug by Marsicano.

Alas, facing a nasty budget crunch in 2003, Barletta decided to use money from that special levy – a 0.4 percent income tax – to pay for retiree health benefits. In 2006, the auditor general said that’s not allowed, and told the city to pay $1.5 million back into the pension fund. Not having a handy $1.5 million in his hip pocket, Barletta balked, warned of bankruptcy, bragged he has reduced the pension fund shortfall even while using the special tax money for something else, filed appeals, and begged the state legislature to change the law to make what he had done retroactively legal. The senate passed such a bill, but it disappeared somewhere in the House of Representatives.

Thus Lou dumped a fresh pile of pension doo-doo on the City Hall rug.

Progress!

On with the show

Anyway, we now tune into the continuation of “Law & Order: TVU.”

DUM-dum!

On Tuesday we learned a hearing officer ruled that the auditor general was, in fact, correct, and the city needs to put the money back into the pension fund. Barletta responded with a rerun of his 2006 spiel, insisting he’s done good, vowing to appeal, warning of bankruptcy and begging for legislative intervention.

Those who have been paying attention – and boy, who doesn’t perk up at the words “pension fund actuarial tables” – surely are suffering an acute attack of d�j� vu.

Regular readers know I’ve always liked Lou. It’s hard not to. In person he can be as affable as Sherriff Taylor in the “Andy Griffith Show,” and sound twice as sincere. But the simple fact is he bollixed this big time, looking more like Barney Fife, only without the dumb-luck happy ending. If the courts or lawmakers don’t bail him out, city residents will be left footing the bill and suffering the consequences.

But there’s a bigger lesson, one that stays hidden only because of the sheer complexity of the subject. Public pension funds have become the cement shoes of many local governments, ready to drown budgets in oceans of red ink. This is partly due to years of neglecting the funds (something Act 205 tried to fix), and partly due to benefit increases that outstrip fund growth (the most notable example being the 2001 increase in teacher pension benefits). The recent financial market meltdown made things worse.

Even if the Hazleton story ends well, it’s a safe bet you’ll see plenty of sequels in cities, counties and school districts near you.

About the Author

Mark Guydish covers education for the Times Leader. Reach him at (570) 970-7161 or mguydish@timesleader.com.

A West Hazleton native, I worked as a service technician repairing electronic mailing and shipping systems, a bike shop owner and an Emergency Medical Technician (among other jobs) before landing a reporter job at the Times Leader Hazleton Bureau in 1995. I started by covering primarily politics in Hazleton City and outlying municipalities, eventually became "social issues" team leader in the Wilkes-Barre office with the accent on education, and headed the Hazleton Bureau for a spell before returning to full-time reporting, my preferred position. I'm an avid cyclist and rode across the country in 1990, a trip of more than 5,000 miles from New Jersey to Seattle and down the coast to San Francisco. Years in the Boy Scouts made me a life long backpacker and camper, and I've yet to find a better way to enjoy the quiet lure of winter snow than cross country skiing.

Mark also writes a regular blog for timesleader.com.