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Mayor Tom Murphy wants to borrow against Pittsburgh's future to find money he can spend before leaving office, charge critics of his proposal to refinance some of the city's long-term debts.

The mayor expects to raise about $7 million to pay for paving roads and other capital projects by refinancing $230 million in long-term debt. Murphy presented the plan to City Council, which expects to take it up for consideration Wednesday.

Instead of spending that money, critics say the administration should reduce future debt payments, bolster the flagging pension fund or set it aside for the next mayor to use. Murphy is not seeking a fourth term in this year's elections.

"The actions of the city are disappointing," said state Rep. Mike Turzai, R-McCandless. "Here's an opportunity to enact real systemic change and to show everyone that we are not about doing business as usual. It appears that it is still business as usual."

The mayor's office defended the plan, saying it lets the city address its infrastructure needs and perhaps put a little aside in savings.

The city's total debt stands at $1.3 billion, including $847 million in principal. The refinancing will save $7 million by taking advantage of lower interest rates while keeping the city's future payments and the time it takes to retire the debt roughly the same.

The mayor's office has not indicated how much would be paid in refinancing fees.

"We have a limited opportunity to take advantage of lower interest rates, and it would be foolish to pass up that opportunity," said Murphy spokesman Craig Kwiecinski, adding that critics of the plan do not understand it.

Officials across the city -- from the controller's office to the state-appointed oversight board -- say they want to know more about the refinancing plan, but have not been able to find out even who the mayor wants to handle the transaction.

"We don't have enough information to decide exactly the transaction the city is attempting to do," said Bill Lieberman, chairman of the oversight board, which was created by state lawmakers to help steer the city out of financial crisis.

Board members are concerned that the city will use the proceeds for something other than the pension fund or paying down the city's long-term debt, he added. The city will spend nearly $91 million -- more than a fifth of its total budget -- on debt this year.

The oversight board, also known as the Intergovernmental Cooperation Authority, will meet Tuesday to discuss the refinancing.

A current analysis of the city's long-term debt shows Pittsburgh will be stuck paying nearly $90 million a year in debt service until 2012, when the debt payment drops to about $75 million. It drops again in 2014 to about $66 million, in 2018 to about $38 million and then bottoms out below $5 million in 2026.

In the past, Pittsburgh has used the windfall from refinancing its debts to reduce the amount it would have to pay back in the future, said Marty Elikan, accounting manager in the city controller's office. He said he is "completely against" the mayor's proposal.

A major advantage of refinancing now is that the city's bond ratings have improved, said Councilman Doug Shields, the new chairman of council's finance committee. In March 2004, the city suffered from a "junk bond" rating and was unable to insure its bond issues.

Moody's Investor Services upgraded the city's bond rating Thursday, saying the city "has solved its severe financial problems, but that some challenges still lie ahead in the current fiscal year in terms of collecting new revenues."

Shields said he opposes spending all the savings this year. He's suggesting the city spend about $2 million this year, combine it with matching state money for road improvements or a vehicle purchase, and use the remaining $5 million for more road improvements in 2006.

But Gerald Shuster, a political communications professor at the University of Pittsburgh and Robert Morris University, argues that an effort to pay down the debt service "at least puts on the spin that the city is trying to generate a better financial status with lenders."

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