Union-Owned Bank Helps Scranton Restore Firefighters & Cops Pay

Mike Elk

Amalgamated Bank, America's largest union-owned bank, has given the city of Scranton a multi-million dollar loan to pay its firefighters and police officers.

Ear­li­er this sum­mer, the city of Scran­ton, Penn­syl­va­nia, cut the pay of its 400 fire­fight­ers and police offi­cers to $7.25 an hour, as Work­ing In These Times report­ed. Scran­ton May­or Chris Doher­ty claimed that he was forced to cut the pay because the city sim­ply did not have enough cash on hand to pay full salaries. Because of its poor finances Scran­ton had also been unable to get a loan to help cov­er the costs of back wages owed to fire­fight­ers and police. But a last-sec­ond $6.25 mil­lion loan from the union-owned Amal­ga­mat­ed Bank will help Scran­ton to meet its pay­roll this Fri­day and to pay the work­ers their backpay.

The City of Scran­ton has faced years of finan­cial tur­moil,” said Scran­ton City Coun­cil Chair Janet Evans in a press state­ment. After every oth­er finan­cial insti­tu­tion aban­doned Scran­ton, Amal­ga­mat­ed Bank today is step­ping for­ward in a bold way to pro­vide crit­i­cal assis­tance that will allow Scran­ton to have time to final­ize the details of our recov­ery plan and get our long-term fis­cal house in order.”

After no oth­er bank would loan mon­ey to Scran­ton, the head of the local fire­fight­ers union made an intro­duc­tion between the Scran­ton City Coun­cil and Amal­ga­mat­ed Bank, which decid­ed that help­ing work­ers was more impor­tant than mak­ing a prof­it off of their loan.

We’re very proud to be finan­cial part­ners with the city of Scran­ton – a city with a rich union his­to­ry,” said Amal­ga­mat­ed Bank’s Pres­i­dent and CEO Edward Gre­bow in a press state­ment. Amal­ga­mat­ed Bank has always sup­port­ed work­ing fam­i­lies when they need­ed finan­cial assis­tance and pro­vid­ing this loan to Scran­ton is the lat­est chap­ter in that history.”

The $6.25 mil­lion loan is a short term tax antic­i­pa­tion note,” which will allow the city to pay $1.1 mil­lion in pay­roll to the city’s 400 fire­fight­ers and police as well as pay $750,000 in back pay. The loan may also help the City of Scran­ton secure a larg­er $19 mil­lion loan, referred to as unfund­ed debt,” that will allow them to meet their bud­get oblig­a­tions for the rest of the year.

We’re hap­py to get this,” Doher­ty told the Scran­ton Times-Tri­bune. We’re hope­ful this will lead to unfund­ed debt.”

The nation’s largest union-owned bank has stepped for­ward in the truest sense of sol­i­dar­i­ty,” says John Judge, pres­i­dent of Scran­ton Fire Fight­ers Local 60. When hear­ing that Scranton’s fire fight­ers, police and oth­er munic­i­pal employ­ees had their wages cut to min­i­mum wage, the lead­ers of Amal­ga­mat­ed con­tact­ed us to see what they could do to help. We helped them engage the city when no oth­er lenders want­ed to step in. We applaud Amal­ga­mat­ed Bank for its lead­er­ship and will­ing­ness to work with us to help Scranton’s work­ers and its residents.”

Mike Elk wrote for In These Times and its labor blog, Work­ing In These Times, from 2010 to 2014. He is cur­rent­ly a labor reporter at Politico.
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