Pittsburgh's failure to coax payments from major nonprofits becomes hot topic in Democratic mayoral primary
Having the city's major nonprofits make payments in lieu of taxes is a goal that has eluded several of Pittsburgh's mayors. So far in his term, it's eluded Mayor Ed Gainey as well.
In his bid for re-election, Gainey says UPMC is to blame for the lack of a deal. But the healthcare giant fires back, laying the fault at the feet of the mayor.
In becoming mayor of Pittsburgh, Gainey made a promise to the taxpayers to make the city's major nonprofits pay up.
"There's no reason why 37% of our property is tax-exempt and you don't pay one dime," Gainey said.
But nearly three and a half years into his term, there is still no agreement with UPMC, AHN, Pitt and CMU. The mayor says one of them is holding things up.
"UPMC has not came to the table and they have canceled. I have invited UPMC to the table several times," Gainey said.
UPMC is the city's largest employer, but for the length of his term, relations between the mayor and the health care giant have been strained at best over SEIU Healthcare's pursuit of unionizing hospital workers.
In his first run, the union contributed $350,000 in independent expenditures to his campaign, and since becoming mayor, Gainey has declined to engage with UPMC on joint programs and has skipped all groundbreakings and other UPMC events. But he denies his union support has been an impediment to a deal.
"Did you make the requirement that there be an SEIU union in UPMC as a prerequisite for an agreement with UPMC?" KDKA-TV's Andy Sheehan asked.
"Never. I believe that the workers of SEIU Healthcare have a right to unionize but I never made it a prerequisite to them doing in lieu of taxes. I never did it," Gainey said.
"You've cut off all relations with UPMC," Sheehan said. "You don't go to any of their groundbreakings, and have no dialogue with the biggest employer in the city of Pittsburgh."
"Andy, that's not true," Gainey said. "If you want me to come to your events, you want me to show up, then let's get to the table and work out a deal for the good people of the city."
UPMC says it has been willing to make a deal with the mayor but says like the other nonprofits it will not go it alone, saying in a statement: "The mayor has long known he can count of UPMC's full participation in programs that are fair and equitable and include all the region's major nonprofits."
The health care giant goes further, saying it is the mayor who has failed to assemble the nonprofits and in fact canceled a scheduled meeting in November.
"You don't think this is a failure on your part?" Sheehan asked.
"We believe that the people of this city deserve it and we will continue to work on it," Gainey said. "This is something a whole lot of mayors have worked on, Andy. I'm not the first one to work on it, but I will be the one to get it done."
Lack of deal becomes major issue in mayoral race
The lack of a deal between the city and the nonprofits has become a major issue in the upcoming Democratic primary for mayor. Gainey's opponent, Allegheny County Controller Corey O'Connor, is blaming the mayor for failing to strike a deal.
"You've had three and half years to sit down with all nonprofits in this city and come up with some type of pilot agreement that would help all of us in the region and yet you've failed to even organize a meeting," O'Connor said.
"Andy, if they wanted to come to the table, you know this, you ain't slow," Gainey told KDKA-TV's Andy Sheehan. "If they wanted to come to the table, they would have been at the table. They don't want to come. So we gotta take the long road."
Without an agreement, the mayor has instead challenged the tax-exempt status of dozens of individual properties owned by UPMC and the other nonprofits. But the challenges have been largely unsuccessful. The city has paid a D.C. firm $147,000 but has reaped only $98,000 in new tax revenue.
"When you're paying your out-of-town supporters with our city tax dollars and you've lost us money, shows you how there's no leadership in the mayor's office right now to get something done for the taxpayers," O'Connor said.
But Gainey argues, "I don't feel that it's a failure. Not at all."
The mayor, in turn, says he's using the only weapon he has to protect the taxpayer and says O'Connor has supported those efforts until recently.
"Before he supported my whole position about going after the nonprofits. Then after ten execs and board members started rewriting checks to him, all of a sudden he changed," Gainey said.
The Gainey campaign is citing about a dozen contributions to O'Connor made by current and former UPMC executives as well as some board members, accusing O'Connor of caving into UPMC's interests. The mayor wants cash from the nonprofits, while he says O'Connor will let them fund programs that reflect their values.
"My values are not in programs. My values are in the people of this city. My values is in the police. My values is in fire. My values is in EMS," Gainey said.
"I'm willing to have a pilot that's going to supports our residents, whether it's our rec centers, whether it's buying new ambulances, whether it's putting in the infrastructure. Where this mayor wants to take your money and basically fill in the gaps for where he lost money over three and a half years," O'Connor said.
