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Altoona is fastest Pa. city to exit financially distressed status

The Associated Press
FILE - This Wednesday, Oct. 7, 2015, file photo shows the Pennsylvania Capitol building in Harrisburg. (AP Photo/Matt Rourke)

ALTOONA, Pa. — Altoona has become the fastest municipality to financially recover and exit “financially distressed” status under a Pennsylvania law.

Act 47 enables municipalities to raise their earned income taxes and sometimes freeze wages of workers even when a union contract might otherwise have prohibited that, among other measures.

Altoona filed for distressed status on April 1, 2012, and exited Wednesday, making it the fastest to do so under the Department of Community and Economic Development program.

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The department’s deputy secretary says residents thought the move would be a “black eye” for the city, but it wound up rescuing the town from insolvency. Workers’ wages were frozen and the wage tax was applied to nonresident workers, among other changes.

Sixteen other Pennsylvania municipalities remain on the list.