The city’s finances are on shaky ground as funds are managed poorly and fraud is becoming pervasive.
In the City of Pittsburgh, the story of funds being mismanaged and fraud taking place is becoming common.
For two years, Pittsburgh Controller Rachael Heisler sounded the alarm about the city’s finances being on shaky ground. She wrote letters, held press conferences, and criticized former Mayor Ed Gainey’s final budget proposal as “not an honest document.”
Few took her warnings seriously. Last week, Mayor Corey O’Connor revealed a budget shortfall that could reach $40 million this year.
“The controller’s office has been talking about a lack of revenue to pay for core services for years at this point. Someone’s raising an alarm bell, and the elected officials who vote on the budget need to listen,” said Peter McDevitt, Heisler’s deputy.
Heisler has raised concerns over the city’s finances since being elected as its independent fiscal watchdog. Two months after taking office in January 2024, she warned that Downtown real estate values were plummeting after the pandemic. Corresponding property tax revenue was also decreasing.
In May 2024, Heisler warned that the city was relying too heavily on federal COVID-19 relief funds.
She sounded the alarm again for officials to minimize the city’s reliance on its “jock tax”, a levy on out-of-town professional athletes and performers. The tax was struck down by the Pennsylvania Supreme Court in September 2025.
In March 2024, Heisler sent a letter to former Mayor Gainey and Members of City Council citing concerns over the budget proposal. She listed multiple areas of fiscal concern. Gainey’s office pushed back against the concerns.
Council ultimately rejected Gainey’s budget proposal and overhauled it.
On Friday after Mayor O’Connor’s address on the dire situation the city’s finances are in, Heisler reacted to the mayor’s comments.
“I believe that the controller’s office has made every effort to be straightforward, direct and honest with the public about the trajectory of the city’s finances,” Heisler said in a recent interview.
“The reason you put out warnings, though, is not so you can be proven right. The reason you put out warnings is so action can be taken,” she added.
O’Connor also inherited millions in unpaid Pittsburgh Water bills from former Mayor Gainey’s administration. The total owed is $9.7 million.
O’Connor had $6 million on hand to pay down the debt, but nearly $4 million needs to be found to pay the rest.
“That is a liability that should have been paid last year… and I cannot explain what their rationale was. Why they didn’t want to process those payments, we can’t explain,” said Heisler.
Along with Heisler’s warnings over the city’s finances. Pittsburgh police have recklessly spent thousands on premium car washes as the city faces the large deficit.
Recent reports show that the city is facing a $30 million budget shortfall and some officers are getting $37 car washes throughout the city.
Police administration is cracking down on the officers that are getting expensive car washes. An internal email showed that the bureau has spent over $11,000 in car washes so far this year.
The email also identified 21 cars that have gotten premium car washes ranging from $17.92 to $36.92.
“Officers are still getting premium car washes… this is no longer acceptable,” the email said.
The email instructed commanders to identify the officers and have them submit a report to the assistant chief of operations explaining why they purchased the more expensive. The reports are due to the assistant chief by the end of the week.
Pittsburgh has also been the center of pervasive fraud schemes.
In January, Attorney General Dave Sunday announced that he targeted two Pittsburgh business owners in a $178,000 EBT card scheme.
The perpetrators were each charged with numerous felonies, including corrupt organizations and dealing in the proceeds of unlawful activity.
The investigation “showed that the pair purchased EBT cards, at a discount from individuals receiving the benefits, then used the cards to make more than $178,000 in purchases at Sam’s Club and other retailers. The pair then sold the goods at a restaurant and deli, both located on East Ohio Street,” said Sunday’s press release.
“These defendants intentionally manipulated a system designed to help underserved residents – all to increase profits at their businesses. Investigators sifted through hundreds of transactions to uncover the scheme and filed very serious charges,” Sunday said.
