Allegheny County will avoid a second year of property tax hikes, but that requires trimming $15 million in administrative expenses to balance the budget, officials said Tuesday.
“We are in this moment where we are trying to do more with less,” County Executive Sara Innamorato said as she released her 2026 budget proposal. “We are trying to make do in a time of economic uncertainty.”
Speaking at a prior briefing, the county manager said tariffs, high inflation and declining taxable real estate value are crunching the budget, while the state and federal government impasses could threaten broader cuts if they stretch beyond next month.
The $1.2 billion operating budget proposal includes a 1.5% increase in expenses, below the standard 3% increase often used to keep up with inflation, and would not cause any layoffs.
County Manager John Fournier said in addition to tariffs and inflation, which are driving up the cost of materials for maintenance, construction and infrastructure projects, the biggest driver of cost increase in next year’s budget is the increase in the number of people incarcerated in the Allegheny County Jail.
Public Source reported in August that the jail’s headcount is 40% higher than 2022. County officials said Tuesday the increase is driving up the lockup’s expenses for next year by $10 million.
A federal government shutdown and a state budget impasse at three months and counting are creating uncertainty around $1.4 billion the county receives annually from state and federal sources, the bulk of which comes from the state.
Fournier said the county is in a hiring “slowdown” until the budget deadlocks are resolved, but more draconian measures could follow if the situation continues into December or beyond.
Real estate tax revenue is expected to decline as property owners continue to file appeals and receive lower assessed valuations, leading to lower tax bills. A combination of pandemic impacts and a change to how values are calculated led to an unusually large number of appeals in recent years, resulting in the first decrease in property tax revenue in recent memory.
Fournier said the county will manage a balanced budget next year by trimming inefficiencies. The executive’s plan calls for eliminating 35 “chronically vacant” positions, reducing staffing ratios at county-run senior centers, auditing the county’s health care program, refinancing bond debt and consolidating the county’s IT expenses, among other actions.
He said the measures will save about $15 million without laying off any employees.
“We are going to get out of this and hit a period of growth at some point again, and we are going to try to keep our county’s budget balanced while we work through that,” Fournier said.
Last year, Innamorato took the unusual step of requesting an increase to the property tax rate, arguing that it was vital to avoid major cuts to programs and staffing. The idea was met with significant opposition from legislators but County Council eventually agreed to raise the county’s millage rate by 1.7 mills.
“You can all exhale,” she told council members Tuesday, telling them there would be no rate hike this year. But she criticized people who opposed her budget plan last year.
“I say this fully aware that it is election season and there are people running for this esteemed body who seem to have some magical thinking about how budgets work and who seem to feel comfortable lobbing insults from the cheap seats,” Innamorato said.
Council will hold hearings on the budget proposal and must pass a final version by the end of the year.
Charlie Wolfson is the local government reporter for Pittsburgh’s Public Source. He can be reached at charlie@publicsource.org.
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