Business View Magazine | December 2018

334 335 the city to work in the mills and nearby limestone quarries. By this time, NewCastle was one of the fastest-growing cities in the country, and with the construction of the largest tin plate mill in America, it also became the tin plate capital of the world. In addition, steel and paper mills, foundries, a bronze bushing factory, ceramic factories, and car-construc- tion plants contributed to the local economy. In the 1920s, NewCastle enjoyed its greatest prosperity, and also established its identity as both the “hot dog capital of the world,” and the “fireworks capital of America.” Its chili dogs are the product of Greek immigrants who came to NewCastle in the early 20th century and established restaurants along with their homes.The notoriety for fireworks is credited to two local fireworks companies of international stature, S.Vitale Pyrotechnic Industries, Inc. (Pyrotecnico) and Zambelli Internationale. In the 1930s, the city, along with most cities of America, suffered during the Great Depression; in the 1940s, industry temporarily surged during wartime. In 1950, the population peaked at 48,834, but NewCastle’s fortunes began to decline over the next few decades as manufacturing companies moved overseas and the city became part of the country’s “rust belt,”with its population dwindling to 28,334 by 1990. The city’s economy and population continued on a downward spiral into the new century, and in 2007, NewCastle went into what is known as “Act 47,” a stipulation in Pennsylvania state law regarding financially distressed communities. Getting out of NEWCASTLE, PENNSYLVANIA “47”has been the main priority of Mayor Anthony Mastrangelo,who grew up in NewCastle, spent his professional life elsewhere as a hospital adminis- trator, and returned to the city to run for mayor and help shore up its finances. “The previous administration used to borrow money to meet operating expenses,”Mastrangelo explains. “So, consequently, they had a short-term service debt that was over $5 million. With a gen- eral fund of only $14-15 million, that’s a third of our budget.” So,with the approval of the City Council and the state, NewCastle implemented a recovery plan with 154 initiatives–things that it needed to do to cor- rect its financial situation.“My first objective was to hire a Chief Financial Officer,”Mastrangelo recounts. “The Act 47 coordinators said that under the pro- gram, I needed a CFO. So,we hired Stephanie Dean in 2008. “When I took over, there was $450 in the general fund, and I had access to no other funds, at all,”Dean remembers.“Obviously, there were severe issues.A lot of themwere cash management and bad inter- nal controls in accounting, and not knowing, day-to- day, howmuch money we had.” The city administration went to work to reduce its debt and build up its cash accounts. For example, in 2010, it sold its sanitation system to the new- ly-formed NewCastle Sanitation Authority.“We set- tled on $17.3 million and they are now responsible for sanitation,”Mastrangelo says.“With that money, we spent $14 million to reduce debt; we spent $2 million to pave streets; and the rest,we put in reserve.”The city also turned over the responsibility