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.”