HAZLETON — Department of Community and Economic Development (DCED) Secretary Rick Siger on Thursday approved Hazleton City’s exit from Act 47, ending the city’s status as a financially distressed municipality after nearly six years.
In a news release from DCED, it stated that the Shapiro Administration is focused on reigniting the economy by strengthening Pennsylvania’s communities, and Thursday’s announcement is “another important step forward in that plan.”
Hazleton was designated as distressed on Sept. 12, 2017, and it is the 22nd Pennsylvania municipality to recover from distressed status.
“The city is very appreciative for the dedication and commitment that the state has towards the future of Hazleton,” said Mayor Jeff Cusat. “I’d like to thank everyone who worked so hard to make this day a reality.”
At the ceremony at Hazleton City hall with DCED Secretary Secretary, were Mayor Cusat, Hazleton City Council President James Perry, Sen. David Argall, and Rep. Dane Watro. Former state Sen. John Yudichak also was among those on hand.
According to the release:
On Aug. 8, 2017, Hazleton filed with the Pennsylvania Department of Community and Economic Development a request for a determination of municipal financial distress pursuant to the Municipalities Financial Recovery Act (Act 47 of 1987).
The determination was made because the city had experienced multiple years’ deficits and was met with the prospect of not paying obligations to vendors and employees. Gerald Cross of the Pennsylvania Economy League was subsequently appointed the Act 47 Coordinator for the city.
“Hazleton is an example of how providing municipalities with more flexible revenue options, like an enhanced earned income tax, and updating antiquated county property assessment can help communities overcome distress and become sustainable,” Cross said. “However, none of this would have been possible without extensive cooperation between the mayor and Hazleton City Council. Having municipal leadership working together for the common good is critical to success.”
Hazleton made significant strides to improve its management practices and fiscal situation. The city experienced an excess of revenues over expenditures for the years 2018-2021 and, based on the adopted 2022 budget and the Act 47 Coordinator’s end of year estimate, is estimated to incur a surplus of $573,683 in 2022. Hazleton’s debt is manageable, and able to be included in the annual budget. The city has also confirmed that there are no claims and/or judgements that would materially impact its financial condition currently or in future years. And finally, projected revenues of the city are sufficient to fund ongoing necessary expenditures, including pension and debt obligations and the provision of municipal services.
Hazleton is the 22nd municipality to recover from distressed status under act 47. Prior to Hazleton, Johnstown, Cambria County, was the most recent community to recover, exiting Act 47 status on April 26, 2023. In Luzerne County, the City of Nanticoke exited distressed status in 2015, and Plymouth Township exited in 2016.
“Congratulations to the local officials, community leaders, businesses, and residents of Hazleton for working together to make this day a reality,” Siger said of Hazleton. “Gov. Josh Shapiro knows that strong, healthy municipalities are essential to grow our economy, and his first budget proposal includes significant investments to build economic prosperity for our businesses, workers, and communities. I look forward to seeing Hazleton flourish as we work together to bring new investment, jobs, and projects to the city in the years ahead.”