Bankrupt Chester needs changes now, before defeated mayor leaves office, state argues

Voters in bankrupt Chester overwhelmingly affirmed that come January they want a sea change in how Pennsylvania’s oldest city is governed. On Wednesday, state officials argued in Pennsylvania Supreme Court that the citizenry would be better served by not waiting.

“We still have six, seven months working with this administration,” Tiffany Allen, counsel to the state receiver who has taken the city into bankruptcy, said during a hearing in Harrisburg marked by frequently pointed questioning from the justices. “We cannot wait.”

Citing intransigence and obstructionism by Mayor Thaddeus Kirkland and his administration, in a perhaps unprecedented decision Commonwealth Court gave Michael Doweary — the receiver appointed to help the city resolve a spiraling financial crisis — the authority to strip key powers from the five members of City Council, which includes the mayor.

» READ MORE: Chester's bankruptcy was 70 years in the making

The ruling was stayed when the city appealed to the high court.

“I think everyone understands the challenges facing the City of Chester,” city attorney Mark Pfeiffer argued. “Removing the elected officials only takes their self-government away from them.”

Earlier in the day, after announcing that the city’s regular council meeting was canceled because three members were absent, Kirkland suggested that he planned to remain active for the rest of his term, which would expire in January. “There’s a lot to be done,” he said, “and we’ll get it done.”

» READ MORE: A Commonwealth Court judge called the city government 'dysfunctional'

On May 16, Kirkland was defeated in the Democratic primary by first-term Councilmember Stefan Roots, by a nearly 2-1 ratio. In effect, that was the general election. No Republican was on the ballot, and Kirkland said he had no plans to run for office again.

In appealing the Commonwealth Court order, the city held that it was “protecting the will of the voters” who had put Kirkland and other Council members in office. Kirkland holds that he inherited, not caused, Chester’s problems, noting the city has been in state “distressed” status since 1995.

The receiver countered that Chester officials “have been judicially determined to be incapable” of governing and “have intentionally obstructed the receiver’s efforts.”

Under the Commonwealth Court order, Council members, including Will Morgan, the director of finance, would lose their department-head powers.

Morgan lost more than $400,000 in a phishing scam, and the receiver wasn’t informed about it for three months. Within a month of learning about it, Doweary filed for bankruptcy.

Other incidents it cited included several months of payments made to an incarcerated employee, later convicted of child rape, and botched federal tax payments that led to a $750,000 penalty.

However, the major driver of a deficit that approaches 80% of the annual city budget has been several years of missed pension payments. Kirkland has said he was unaware that the payments weren’t being made.

» READ MORE: The city lost $400,000 in a phishing scam

In its Supreme Court filing, the receiver’s office said it was seeking “to create a baseline level of professional management required for the basic functioning of the city.”

Allen said the problem was the Kirkland administration: “It’s still there.”

It was not known when the court might render a decision.