The city of Johnstown is now less than two years away from its deadline to exit the state’s Act 47 program for distressed municipalities.
The city followed the state’s recommendation and entered into the program in August 1992, and with that decision came access to grants, loans and economic advice available to other participants.
Now, approaching 30 years later, Johnstown’s difficulties have been well documented:
• More than $22 million is owed in pension obligations, and the city is more than $10 million in general debt.
• A state-mandated sewer remediation project is expected to cost municipalities more than $100 million. On top of that, customers will be required to pay millions to make their systems compliant. The project is about 40% complete.
• Deborah Grass, the city’s Act 47 coordinator, has called the turnover rate among leadership positions “troubling.” With the recent resignation of George Hayfield, Johnstown is seeking its seventh city manager since 2014. In addition, the city is on its third full-time economic development director since 2017 and its fourth full time finance director since 2015.
• It is estimated that up to 900 blighted properties are located throughout the city’s neighborhoods.
• More than one-third of the city’s residents live in poverty, with the median household income about $23,000. The unemployment rate is consistently higher than state and national levels.
• Studies have ranked Cambria among the top three counties for per-capita overdose deaths as the result of the opioid epidemic.
But for all the negatives, we are encouraged that Johnstown has shown signs of progress as it prepares to exit Act 47.
According to audits, the city finished 2016 through 2018 in the black with a reserve fund balance of more than $1.5 million.
“We are coming off three years of positive fund balances, which is the first time I’ve seen that, and I’ve been working with the city over a decade on the financial analysis part of the program,” Grass told reporter Dave Sutor. “This is the first time that the city has actually had sufficient revenue to cover all their expenditures for a three-year period. That is amazing to me, because it took a lot of hard work. The officials had to make a lot of hard decisions. I really feel that they’re going to be ready and it’s going to be sustainable. That’s the most important part is that it is sustainable into the future.”
The city also has enjoyed a revival of its downtown in recent years. In addition to a number of new restaurants and shops, the Johnstown Redevelopment Authority has turned the empty former Lincoln Center on Main Street into its headquarters, as well as the home for other organizations and businesses.
And Patrick Quinn, property program director at the Center for Metal Arts, relocated his metal-smithing school to former Bethlehem Steel property, hoping to build on the city’s industrial heritage.
“We’ve been very successful, over the last four years, with relocating businesses, as well as expansions, to the city of Johnstown,” JRA Executive Director Melissa Komar said.
The city also has capitalized on its abundance of natural resources such as the Stonycreek River, a hub for kayakers and canoeists throughout the summer, as well as the many hiking and biking trails throughout the region.
And the volunteer-based Vision 2025 initiative was formed in 2015 with a goal to better the Johnstown region.
“That is not typical for a community that is an Act 47 community,” Grass said. “Generally, we don’t see a lot of new businesses, new housing starts, anything like that. In Johnstown – in particular in the downtown area – we’re seeing a lot of investment, a lot of private investment, a lot of professional people who are really excited and interested and supportive of Johnstown.”
Johnstown has come a long way since 1992, but many hurdles remain for the city to become viable on its own. But the developments over the past several years show that Johnstown is headed in the right direction.