Mayor Chris Doherty is seeking the loan to help the city meet expenses, including payroll. It would be paid back at 8 percent interest over 10 years.
The Scranton Composite Pension Board, which represents police, fire and civilian worker pension funds, tabled the mayor's request. The pension funds are already considered to be severely underfunded, and the board's financial consultants urged caution.
City Controller and pension board member Roseann Novembrino told The Times-Tribune on Wednesday she's against the plan—in which the pension plans would buy municipal bonds—even though it would help the city meet payroll.
"The hardest thing for me to do is not to be able to sign the paychecks for people who have earned it," she said.
Doherty ignored a court order and cut the pay of nearly 400 workers to $7.25 an hour in paychecks earlier this month, saying it was all the cash-strapped city of more than 76,000 could afford. Full wages were restored in the next pay period.
Unions representing firefighters, police and public-works employees have sued Doherty and the city, alleging violations of labor law and due-process rights, and are seeking to have him held in contempt of court.
Doherty is locked in a dispute with Scranton's city council over a financial recovery plan as it faces a $16.8 million budget deficit. He said the city can't borrow money because he and council can't agree on the plan.
Information from: The Times-Tribune, http://thetimes-tribune.com/