Allentown seeks to cut costs

Allentown is taking the next step in the state's early intervention program for cities with financial difficulties, hoping to identify ways to earn money and cut costs.

The city received a state grant of $86,000 last week that will pay for most of the work, which includes updating its five-year financial plan laying out the money-making and saving strategies. The city will pay about $22,000.

Allentown Mayor Ed Pawlowski's administration says it is continuing with the program because suggestions identified in the first phase two years ago helped. The first phase cost Allentown about $64,000.

The plan, written by consultant Public Financial Management in Philadelphia, suggested the city levy an emergency and municipal services tax and resolve its police pension issue.

The $52 annual tax was enacted, with voter approval, last year. It collects about $2 million annually from people who work in Allentown and use city services while on the job. The tax, though, is being challenged in court.

Also last year, the city reached a court-brokered settlement with its police union over the pensions of 53 officers. It is projected to cut the cost by $16 million over 20 years.

The second phase of the program aims to identify other sources of income, such as selling advertising space on city vehicles and property, its Web site and in mailings such as bills.

The city also intends to begin charging fees to connect new buildings to its water and sewer systems, Hilliard said. The fees are common in other places.