The following is a transcript of a report by Team 4's Jim Parsons that first aired May 14, 2008, on WTAE Channel 4 Action News at 5 p.m.

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Do you feel it is time for Allegheny County's 130 local governments to consolidate?

So far, a lot of boroughs and townships have been balking at the suggestion, afraid they'll have to take on the city of Pittsburgh's debt problem. But a Team 4 investigation uncovered a new twist.

PDF: List of Borough-Township Debt Service Payments

Team 4's Jim Parsons figured out that the suburbs have a huge debt problem of their own.

Everyone talks about Pittsburgh's red ink, but it turns out the debt that boroughs and townships have collectively racked up is almost as large as the city's.

This is usually what happens in western Pennsylvania when a borough or township tries to have a debate about consolidation.

Public Outburst at Council Meeting:

"I would like her removed. Remove her. Because I tell the truth and you don't. That's why I'm removed Amy. You're a liar. You are a liar. Don't touch me. "

This happened last month in Versailles Borough when council considered consolidating emergency services with nearby White Oak.

Herb Hartle is president of the Allegheny County League of Municipalities. He said boroughs and townships are opposed to any merger plan that includes giving up local control of services.

"We are highly over-policed in Allegheny County," said Hartle. "But you try to tell that to the residents, they don't want to hear that. You're taking away my police department, and I'm not going to let you do that. They have to buy in to what you're doing, because if they're not on board with it, this is going nowhere."

But something has to give, because local communities are going broke. WTAE's Team 4 investigation examined audited financial statements for all 130 local governments in Allegheny County going back five years. We found budgets that haven't been balanced for years and long term debt that is crushing in its scale.

Almost one half of all boroughs, townships and cities in Allegheny County have run a deficit for two or more years. Collectively, they have long term debt of almost $500 million, and that doesn't include the city of Pittsburgh.

A third of them have so much annual debt service that it is more than 10 percent of their budgeted expenditures.

The University of Pittsburgh's public service degree coordinator, George Dougherty, said that is way too high.

"At that point, what you're doing is cutting back on day to day services to cover capital investments," he said.

If 10 percent is too high, how about 20 percent? Team 4 found five communities where debt service is 20 percent of the budget or higher and has been for at least the past two years.

"That's a danger sign," said Jake Haulk of the Allegheny Institute for Public Policy. "The only time you should ever do that, well, you should cut spending first."

And the largest expense, by far, is police. Municipalities last year, again, not including Pittsburgh, spent a combined $143 million on police. That is almost half of all wage taxes and real estate taxes collected.

"We got to figure out a way to be more efficient and consolidate some of these departments that really are right next to each other and save money and get full time police officers on the street," said Allegheny County Chief Executive Dan Onorato.

Ohio Township Police Chief Norbert Miklos has a 24-officer department that now contracts police services with eight adjacent communities, including Ohio Township, recently added Ben Avon, Ben Avon Heights, Kilbuck and Aleppo.

"There's going to be drawbacks," he said. "You're going to get people who are skeptical." Those communities that have the single, one officer on a shift and three or four man departments could never offer what we offer. So, it's good for them and good for us."

But two other communities along Ohio River Boulevard, neighbors Avalon and Bellevue, are holding on to their own tiny police departments.

"That's what the residents want," said Herb Hartle of the Allegheny League of Municipalities. "If they keep electing those people back into office, that means they're satisfied with the status quo.

When asked if there should be changes, Hartle said, "Yes. I always thought Bellevue and Avalon, that the police department there should be one."

Avalon Borough has been operating in the red for three years in a row.

As for Bellevue, who knows? The audited financial statement submitted to the state is blank for all revenues and expenditures.

And Team 4 found two others, Elizabeth Borough and Cheswick, that are more than a year overdue filing their finances. But that didn't stop the state Department of Community and Economic Development from paying out grant monies to Elizabeth and Cheswick.

Parsons asked Fred Reddig, the DCED assistant secretary, what actions they take when they don't file on time?

"Again, we will send reminder letters to them, notifying them that their audit letters are due," said Reddig. "That's it."

Nothing happens. And as long as we continue to see Allegheny County not as a whole, but as a jigsaw puzzle of 130 separate pieces, experts said nothing will happen to stem the tide of red ink.

"We're putting this weight on the backs of our children in the future," said Dougherty. "Municipalities really need to find ways to share services."

In the meantime, there is one change happening because of Team 4's investigation. The Gov. Ed Rendell Administration said it would no longer release any grant funds to local municipalities that are more than nine months late filing their required audits.

Team 4 tried to get the perspective of a local government having financial difficulty. Parsons left messages with Kennedy Township's manager and the borough manager in Avalon. Neither returned our calls.

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