(1) Projected revenues and expenditures of the principal operating fund or funds of the assisted city for five fiscal years consisting of the current fiscal year and the next four fiscal years.

(2) Plan components that will:

(1) All projections of revenues and expenditures in a financial plan shall be based on prudent, reasonable and appropriate assumptions and methods of estimation. All assumptions and methods shall be consistently applied and reported in the financial plan. The financial plan of an assisted city may not include projected revenue that in order to be collected requires the enactment by the General Assembly of new taxing powers.

(2) All revenue and appropriation estimates shall be on a modified accrual basis in accordance with generally accepted standards agreed to by the authority, such as those promulgated by the Governmental Accounting Standards Board, and shall be subject to the following provisions:

(3) All cash flow projections shall be based on prudent, reasonable and appropriate assumptions as to sources and uses of cash, including, but not limited to, prudent, reasonable and appropriate assumptions as to the timing of receipt and expenditure thereof, and shall provide for operations of the assisted city to be conducted within the resources so projected. All estimates shall take due account of the past and anticipated collection, expenditure and service demand experience of the assisted city and of current and projected economic conditions.

(1) For each of the first two fiscal years covered by the financial plan, information that reflects an assisted city's total expenditures by fund and by lump sum amount for each board, commission, department or office of an assisted city.

(2) For the remaining three fiscal years of the financial plan, information that reflects an assisted city's total expenditures by fund and by lump sum amount for major object classification.

(3) Projections of all revenues and expenditures for five fiscal years, including, but not limited to, projected capital expenditures and short-term and long-term debt incurrence and cash flow forecasts by fund for the first year of the financial plan.

(4) A schedule of projected capital commitments of the assisted city and proposed sources of funding for those commitments.

(5) A statement describing in reasonable detail the significant assumptions and methods of estimation used in arriving at the projections contained in the plan.

(1) Within 90 days of the initial organizational meeting of the board under section 202(c),³ the assisted city shall develop and the authority shall review and act upon an initial five-year financial plan that includes a report on the status of implementation of prior published suggestions regarding consolidation and cost savings.

(2) During each subsequent fiscal year, the chief fiscal officer of the assisted city shall, at least 100 days prior to the beginning of the assisted city's fiscal year or on another date as the authority may approve upon the request of the assisted city, prepare and submit its proposed five-year plan.

(3) At the same time the plan is submitted, the chief fiscal officer shall also submit to the authority:

(1) The chief fiscal officer of the assisted city shall submit, and the governing body of the city or assisted city shall adopt, a balanced budget each year consistent with the assisted city's governing law.

(2) A balanced budget of an assisted city may not include projected revenues that in order to be collected require the enactment by the General Assembly of new taxing powers or the approval of a court of common pleas of the county in which the assisted city is located.

(3) The failure of the assisted city to comply with this subsection shall result in the withholding of Commonwealth funds under section 210(e) and (f).

(1) The authority shall promptly review each financial plan, proposed operating budget and capital budget submitted by the assisted city. In conducting the review, the authority shall request from the controller of the assisted city an opinion or certification, prepared in accordance with generally accepted auditing standards, with respect to the reasonableness of the assumptions and estimates in the financial plan.

(2) The controller and other elected officials of the assisted city shall comply with a request under paragraph (1).

(3) Not more than 30 days after submission of a financial plan and proposed operating budget, the authority shall determine whether:

(4) If the authority determines that the criteria under paragraph (3) are satisfied, the authority shall approve the financial plan.

(5) The authority shall not be bound by any opinion or certification of the controller or other official of an assisted city issued under this subsection.

(6) If the authority fails to take any action regarding a financial plan within 30 days following submission of the plan to the authority, the financial plan as submitted shall be deemed approved. If, during the 30-day period, a written request by two members of the board for a meeting and vote on the question of approval of the financial plan has been submitted to the chairperson and a meeting and vote do not take place, the financial plan shall be deemed disapproved.

(1) If the authority disapproves the proposed financial plan of the assisted city, the authority shall, when it notifies the assisted city of the authority's decision, state in writing in reasonable detail the reasons for the disapproval, including the amount of any estimated budget imbalance.

(2) The assisted city shall submit a revised financial plan to the authority within 15 days of a disapproval under paragraph (1), and the revised plan must eliminate the budget imbalance.

(3) Not more than 15 days after the submission of the revised financial plan, the authority shall determine whether the revised plan satisfies the criteria under subsection (g)(3).

(4) If the authority determines that the criteria are satisfied, the authority shall approve the financial plan.

(5) If the authority fails to approve the financial plan, the authority shall, in accordance with section 210(e),⁴ certify the assisted city's noncompliance with the financial plan to the Secretary of the Budget, the President pro tempore of the Senate and the Speaker of the House of Representatives.

(1) The plan shall be revised on an annual basis to include the operating budget for the next fiscal year and to extend the plan for an additional fiscal year. The chief fiscal officer of an assisted city shall, within 90 days of assuming office, propose revisions to the financial plan or certify to the authority that the chief fiscal officer adopts the existing plan.

(2) An assisted city may, during the course of a fiscal year, submit proposed revisions to the financial plan and shall submit a proposed revision for any amendment to the city's operating or capital budget.

(3) The authority shall review each proposed revision within 20 days of its submission. The authority shall approve the revision if it will not, based on prudent, reasonable and appropriate assumptions, cause the plan to become imbalanced.

(4) Proposed revisions shall become part of the financial plan upon the approval of the authority unless some other method of approval is permitted by authority rules and regulations approved by the board or pursuant to an agreement with the assisted city contained in an intergovernmental cooperation agreement.

(5) If the authority fails to take action within 20 days on a proposed revision, the submission shall be deemed approved unless a written request for a meeting and vote has been made in accordance with subsection (g)(4), in which event, if a meeting and vote do not take place, the proposed revision shall be deemed disapproved.

(6) If the governing body of a city adopts a budget inconsistent with an approved financial plan, the assisted city shall submit the enacted budget to the authority as a proposed revision to the plan. The authority shall review the proposed revision within 30 days of its submission in accordance with the criteria under subsection (g) and the approval process under paragraph (3).

(1) Within 45 days of the end of each fiscal quarter of an assisted city, or monthly if a variation from the financial plan has been determined in accordance with section 210(c), the chief fiscal officer of the assisted city shall provide the authority with a report describing actual or current estimates of revenues and expenditures compared to budgeted revenues and expenditures for the period reflected in the assisted city's cash flow forecast.

(2) A report required under this section shall indicate any variance between actual or current estimates and budgeted revenues, expenditures and cash for the period covered by the report.

(3) An assisted city shall also provide periodic reports on debt service requirements in conformity with section 210(b).

(1) A contract or collective bargaining agreement in existence in an assisted city prior to the approval by the authority of a financial plan submitted under this section shall remain effective after approval of the plan until the contract or agreement expires.

(2) After the approval by the authority of a financial plan submitted pursuant to this section, an assisted city shall execute contracts and collective bargaining agreements in compliance with the plan. If an assisted city executes a contract or a collective bargaining agreement which is not in compliance with the plan, the contract or agreement shall not be void or voidable solely by reason of the noncompliance, but the assisted city shall submit to the authority a proposed revision to the plan which demonstrates that revenues sufficient to pay the costs of the contract or collective bargaining agreement will be available in the affected fiscal years of the plan.

(3) Nothing in this act shall be construed to in any manner violate, expand or diminish the provisions of the Municipalities Financial Recovery Act relating to collective bargaining agreements.

(1) After the approval by the authority of a financial plan submitted pursuant to this section, any arbitration settlement of a board of arbitration established pursuant to the provisions of the act of June 24, 1968 (P.L. 237, No. 111),⁵ referred to as the Policemen and Firemen Collective Bargaining Act, providing for an increase in wages or fringe benefits of an employee of an assisted city under the plan, in addition to considering any standard or factor required to be considered by applicable law, shall take into consideration and accord substantial weight to:

(2) The arbitration settlement shall be in writing and a copy thereof shall be forwarded to each party to the dispute and the authority. Any arbitration settlement of the board of arbitration which provides for an increase in wages or fringe benefits of an employee of an assisted city shall be in writing and shall state with specificity all factors which the board of arbitration took into account in considering and giving substantial weight to the factors referred to in paragraph (1).

(3) Any party to a proceeding before a board of arbitration may appeal to the court of common pleas to review:

(4) An appeal under paragraph (3) must be commenced not later than 30 days after the issuance of a final arbitration settlement by the board of arbitration.

(5) The decision of the board of arbitration shall be vacated and remanded to the board of arbitration if the court finds:

(6) If, after the exhaustion of all appeals, the final arbitration settlement is not in compliance with the approved financial plan, the arbitration settlement shall not be void or voidable solely by reason of such noncompliance, but the assisted city shall submit to the authority a proposed revision to the plan which demonstrates that revenues sufficient to pay the costs of the arbitration settlement will be available in the affected fiscal years of the plan.

(7) As used in this subsection, the term “arbitration settlement” shall mean an adjustment or settlement of a collective bargaining agreement or dispute. The term includes a final or binding arbitration award or other determination.