A little over a century ago Scranton was at the center of the thriving coal industry and had a larger population than Los Angeles.
Today, the Lackawanna County seat is struggling for its fiscal life. On Monday, Scranton's business manager reported that the city had only $133,000 of cash on hand and couldn't pay its bills, which totaled $3.4 million.
The city's Democratic mayor, Chris Doherty, who has been at odds with city council on how to raise the money, said warning letters have been received from the water company, which threatened to cut off service, as well as from the company that supplies the fuel to its police cars and fire trucks and from the landfill which handles the city's garbage.
With the city of 76,000 out of cash, Doherty, whose strategy to raise taxes has been rejected by the city's Democratic council, took the unprecedented step of slashing the paychecks for 398 city employees to the minimum wage of $7.25 an hour.
A number of lawsuits have been filed against the mayor, including one in federal court under the Fair Labor Standards Act, accusing the city of failing to pay wages on time and failing to pay overtime and another alleging that benefits for disabled police and firefighters were cut without a hearing. The unions representing city workers won a court injunction ordering the mayor not to cut their pay but Doherty issued the minimum wage checks anyway last Friday. The union went back to court yesterday to challenge the pay cuts and to ask the judge to hold the mayor and the city in contempt of court.
There are many American cities with serious budgetary problems but Scranton finds itself in the crosshairs of financial disaster because of a perfect storm of circumstances. While the city has been losing population at a steady rate for years, the housing crisis and recent recession have taken a heavy toll and labor costs have increased, including health care.
The city is also unable to borrow. The municipal bond market cut off credit and the one bank which was willing to help the city raise money pulled out of a $16 million short-term financing deal.
We question the priorities of our president and vice president. After a natural disaster, for example, the president or vice president are often at the scene helping to boost morale and encouraging citizens to remain strong.
Why should a city facing a fiscal catastrophe be any different? But then again, this is an election year and these are professional politicians.
A week ago, Vice President Joe Biden had a perfect opportunity when he visited Scranton, his boyhood hometown, to deliver a July 4th speech in the Courthouse Square. Although he reportedly avoided political issues, Biden found the time to later meet with union leaders during his trip.
A few days later, President Obama made a campaign stop in Pittsburgh as part of his bus tour through the crucial swing states of Ohio and Pennsylvania. It would have given the people of Scranton encouragement to know that Biden or Obama cared enough to visit and discuss their fiscal plight. But a city in financial distress doesn't make very good copy or provide a positive political sound byte for the newscast, especially in a bad economy.
Instead, Scranton citizens are on their own, left to contemplate Mayor Doherty's searing question to his opponents on meeting the payroll for city employees: "What am I going to pay them with?"
By Jim Zbick