While governments elsewhere slash programs or raise taxes, the city of Pittsburgh expects to do neither next year, according to the plan Mayor Luke Ravenstahl gave to City Council yesterday.

Philadelphia plans to mothball 68 pools, 11 libraries and three ice rinks. The state is halving funding for some educational, veterans and business development programs. Allegheny County is spared only because of its new drink and car rental taxes.

And Pittsburgh? It will provide more civilian help for the police and boost most salaries by 2.5 percent while lowering the parking tax. A fiscal basket case five years ago, it's now in a position other governments would envy.

The city's comparatively strong position is a result of both its troubled past and its time-lag economics, officials say, and may be undermined by its teetering pension fund.

"We've made our cuts last year, the year before, and the year before that, in going through [state oversight]," said Mr. Ravenstahl. "We've done more than Philadelphia and the state have done before today."

"It takes a while for economic trends to hit the city of Pittsburgh," added Finance Director Scott Kunka. "The full extent of what happens really hasn't hit yet."

Mr. Ravenstahl expects the city to take in $441 million next year and spend $438 million.

His blueprint -- including $45 million in spending on capital improvements like paving, vehicles and demolitions -- has already gotten the approval of the state-picked Intergovernmental Cooperation Authority, and a council overhaul isn't likely.

Council Finance Chair William Peduto called it a "bridge" budget between an expired recovery plan and an emerging one, which he hopes will "restructure what city government is, completely."

The city also expects next year to be a bridge between a string of robust surpluses and a series of razor-thin ones that will start in 2010. Because of state-mandated tax cuts, the budget will tighten even after gambling revenue starts flowing -- and that's assuming the city's economy stays stable.

"Pittsburgh has weathered the economic storm pretty well, and better than most regions around the country," said Controller Michael Lamb. That said, the city is "not immune to the global economic crisis."

For instance, the interest rates the city makes on its bank balances have "gotten crushed," said Mr. Lamb.

The strapped state plans to cut its subsidy to the city by 10 percent, or $597,000 -- a hit not yet reflected in the city budget.

The pension fund, which was $569 million short of ideal levels at mid-year, has taken a "pretty significant" hit since then, Mr. Ravenstahl said. A current balance wasn't available.

If the local economy worsens, it could threaten income taxes expected to bring in $64.6 million, deed transfer taxes pegged at $15.4 million and the city's hoped-for $12.8 million sliver of the countywide sales tax.

Debt used to be the city's biggest problem, but Mr. Ravenstahl's no-borrowing policy has the city on track to cut its payments in half by 2017.

Now the pension fund is the hidden cancer.

Its mid-year balance of $330 million was bolstered by a $42 million infusion of city and state funds, then depleted by the stock market swoon. The fund needs to earn an 8.75 percent return on its investments to stay stable and creep toward the desired $899 million level. But now portfolios nationwide are in free fall.

The pension deficit "is going to be the number that eats the city alive," said council President Doug Shields.

Mr. Ravenstahl had planned to put $54 million in the fund next year, or 15 percent more than the state-mandated minimum. Now he's scaled that back to $49.7 million, or slightly more than 5 percent more than the minimum.

"I wish they would have stuck with the 15 percent commitment," said Mr. Lamb.