Pittsburgh City Council voted Sunday to raise property taxes by 20%, down from an earlier proposal for a 30% tax hike.
Council supported the 20% tax hike — the first increase in more than a decade — in a 6-2 vote after hours of deliberation Sunday.
“I do feel this is the best path forward to address our aging vehicle fleet. I do feel this is the best path forward to address what I do see as core services,” like the city’s violence intervention programs, said Councilman Khari Mosley, D-Point Breeze, who sponsored the 20% compromise.
A 20% tax increase will bring in an additional $28 million to the city’s coffers next year, raising the city’s total real estate tax revenue estimate to more than $171 million, according to estimates prepared by City Council Budget Director Peter McDevitt.
The average household would pay an extra $164 a year, McDevitt’s estimates show.
This jumps the city’s property tax millage rate from 8.06 to 9.67.
City Council approved Sunday a $693 million operating budget and a $110 million capital budget.
“As the process moves forward, the mayor will thoughtfully evaluate the decisions made by City Council today, particularly in light of the significant tax increase and numerous modifications to planned spending that were approved,” Olga George, a spokesperson for Mayor Ed Gainey, said in a written statement. “That review will focus on understanding the impact on residents, businesses and the long-term financial health of the city with the goal of continuing to serve the community in a fair, responsible and transparent manner.”
Office of Management and Budget Director Jake Pawlak told TribLive it was too soon to say whether Gainey would sign or veto the spending plan.
“We’re going to review that with the mayor in the next couple of days before the holiday,” Pawlak said.
Council members during a public hearing Saturday indicated they had not yet reached a consensus 24 hours before their final vote on the budget was scheduled. Their opinions on the tax hike remained split Sunday.
“We have to fix our own house before we charge you more for your house,” said Councilman Bobby Wilson, D-North Side, pushing against a tax hike. Councilwoman Theresa Kail-Smith, D-West End, joined Wilson in voting no.
Councilman Anthony Coghill, D-Beechview, joined them in opposing the measure during a preliminary vote Sunday but was absent for the final vote.
Other members said a tax increase was the only way to stave off serious cuts that would impact the services that residents expect from their city. Voting yes alongside Mosley were Deb Gross, D-Highland Park, Bob Charland, D-South Side, Barb Warwick, D-Greenfield, Erika Strassburger, D-Squirrel Hill, and Council President R. Daniel Lavelle, D-Hill District.
During a contentious meeting Sunday, some council members attempted to revoke the preliminary vote on a tax hike, while waiting for further opinions from the city’s law department. That motion failed.
Gainey, in late September, unveiled a spending plan that did not raise taxes, lay off workers or cut services. But council members, their budget director and the controller unanimously agreed the mayor’s budget also failed to properly account for all of the city’s expenses.
Critics said it lowballed costs by at least $20 million, falling short on allocations for public safety overtime, utilities and investments to an aging vehicle fleet.
Though council members largely agreed the budget needed significant revisions, whether to raise taxes remained a point of contention through Sunday’s preliminary votes.
“It frustrates me to hear people who really have great incomes talk about raising taxes on people who don’t have great incomes,” Kail-Smith said.
She said she worried that low-income residents may not be able to shoulder another tax hike, after the county raised property taxes by 36% this year. Pittsburgh Public Schools property taxes will jump 2% next year. Kail-Smith called for the city to cut costs, rather than asking taxpayers to pay more.
“We could freeze everything that was nonessential to the city of Pittsburgh’s function,” she said. “But we’re not.”
Coghill said the city has been “irresponsible” in spending with things like a costly affordable housing bond and a $6 million comprehensive plan.
“To put this on the backs of our property owners right now is just irresponsible,” he said. “I won’t do it.”
But other council members insisted a tax increase was the only way to avoid drastic cuts. The 2026 budget will include some trims — including axing about 50 unfilled job positions — even with a tax bump.
“Here at council, we have been told under no uncertain terms by our controller and also by our budget director that we are in a very precarious financial position,” said Warwick, who pitched the 30% tax hike but ultimately supported the smaller figure. “This has been made clear to council members. And so I felt it was imperative that we act on that information.”
Gross pointed out the city hasn’t increased property tax rates in more than a decade.
Charland, who co-sponsored the 20% tax hike amendment, said he felt a tax increase was the only way to ensure his residents receive basic city services.
Still, he said, he worried it would cause hardships for some residents. Charland said voting to raise taxes was something he did not take lightly.
“It’s something I’ve really wrestled with here,” he said.
Council members before voting on the budget explored a litany of solutions, including spending cuts and an increase to property tax rates.
The city in recent years has seen its revenues dip, fueled largely by the lack of a countywide property reassessment and declining values in the Downtown commercial real estate base. Federal covid-19 relief money is mostly exhausted. The Pennsylvania Supreme Court barred the city from collecting the facility usage fee, a tax on out-of-town professional athletes and performers.
Council members also voted on a slew of budget amendments Sunday.
They voted to spend an extra $10 million on much-needed upgrades to the decrepit vehicle fleet, bringing its total budget to $20 million next year.
Council also added $6.5 million more to the budget for utility bills and an extra $8 million for fire and EMS overtime costs, reflecting concerns that Gainey’s version of the spending plan had not included enough money for those expenses.
Reversing course from a preliminary vote Thursday, council decided to keep the police bureau’s mounted unit. Council had voted to eliminate the unit this year, but the bureau never got rid of it, spurring Warwick to suggest cutting it again this year.
“The body voted to cut this last year, and they just defied us,” Warwick said.
But other members voted to save the unit, arguing the horses could come in handy for crowd control during the upcoming NFL Draft and other large events.
Council decided not to eliminate the budget for part-time Department of Public Works employees who help clean up blighted properties, despite signaling they may do so during a preliminary vote last week.
Council also voted to change add and swap various positions in the mayor’s office, based on requests from Mayor-elect Corey O’Connor. The amendments approved Sunday still keep the mayor’s office smaller — and cheaper — than it has been under Gainey.
The Stop the Violence fund will see a $5 million allocation next year — half its normal amount. But officials said the fund — which pays for the Office of Community Health and Safety and provides grants to nonprofits that aim to prevent violence — will not have to cut its operations next year. Instead, it will draw down on a balance sitting unspent in the trust fund.
Pawlak said halving the Stop the Violence allocation next year was an area “of particular concern” to the administration.
Other changes council made Sunday include giving the Urban Redevelopment Authority an additional $1 million for small business development, slashing $500,000 from the budget for new computers and trimming spending earmarked for training and conferences.
Once City Council approves a budget, it is sent to the mayor for his approval. If Gainey vetoes the budget, council must take another vote to override his veto. Six members must vote to override a mayoral veto, rather than a simple five-member majority. A meeting has been scheduled for 11 p.m. on New Year’s Eve to take that vote, if needed.
This story will be updated.