In 1st budget address, O'Connor proposes no tax increases but millions in cuts

Pittsburgh Mayor Corey O'Connor on Monday delivered the first budget address of his administration after a projected $250 million deficit over the next five years.

O'Connor, who is proposing no tax increases but millions of dollars in cuts, pointed to the Gainey administration for the city's tough financial position. 

"The way the budget has been structured for the past several years is a big reason why we are facing these challenges," he said. "We cannot afford to kick the can down the road for somebody else to deal with it. If we don't change course, that would mean cuts to our basic services, like no resources for kids, no park maintenance."

O'Connor proposed a $727 million operating budget and a $145 million capital budget for next year. The spending plan relies on more than $28 million from city reserves, reducing pension funding by $10 million a year over the next five years.

O'Connor said that the challenges will require "careful management," but the city will still invest "in our communities and the future of this city." 

"We will focus on things that will move our city forward, like delivering core government services and making strategic investments in people and in places," he said. 

O'Connor addressed how, in his first year in office, he has made improvements to things like the aging city fleet, affordable housing and making the permitting process easier. He also reaffirmed his commitment to selling Pittsburgh.

"Our city needs to grow," he said. "That is why we are trying new ways to say yes to making it easier to grow here."

Chief of staff Dan Gilman says they are looking for solutions. 

"We clearly need new revenue sources and we cannot continue to just go back to the Pittsburgh residents and ask for that over and over again and still be a city that families choose," Gilman said. 

Meanwhile, Councilwoman Barb Warwick said none of this came as a surprise to council.

"It is a very tight budget year," Warwick said. "That is the reality. Just like last year, we knew city council knew that we had tight years coming ahead."

As for the projected deficit for 2027, "We are currently figuring out where we are going to end up this year," Gilman said. 

"We are at $28 million coming out of the rainy day fund for 2027 to balance the budget, but of course that is based still off of third quarter numbers," Gilman said. "We expect it to change before January."

City council can now make changes to O'Connor's proposal, but they must approve the budget before the end of the year.