Tag Archives: Harrisburg

Harrisburg just keeps getting worse

After Harrisburg, PA defaulted on its incinerator bonds, started selling off pieces of itself, and threatened bankruptcy (twice), now the SEC is suing the city for fraud.

James O’Toole wrote for CNN Money 6 May 2013, SEC sues financially troubled Harrisburg,

The Securities and Exchange Commission has sued the city of Harrisburg for fraud, alleging that officials in the Pennsylvania capital misled the public about the city’s financial condition.

The SEC says the misleading statements came in the city’s 2009 budget report, its annual and mid-year financial statements and a “State of the City” address. The case marks the first time the SEC has charged a municipality with misleading investors in statements made outside of securities documents.

Harrisburg has been mired in

Continue reading →

Harrisburg prepares to file bankruptcy

After defaulting on its incinerator bonds and preparing to sell off pieces of itself, Harrisburg, PA, is preparing to file bankruptcy.

Laura Vecsey wrote in Pennlive 16 June 2011, Harrisburg City Council looks to introduce resolution that would allow bankruptcy paperwork to be prepared:

Harrisburg City Council member Brad Koplinski is seeking to introduce a resolution that will allow the council to prepare paper work that might become necessary should a majority of the council decide to file for Chapter 9 bankruptcy.

Koplinski said the urgency of being prepared escalated Thursday when state Sen. Jeffrey Piccola introduced legislation that called for a state takeover of Harrisburg should the distressed city fail to adopt the Act 47 plan it was presented Monday.

It seems Harrisburg applied for Act 47, which is apparently a state bankruptcy protection plan last October, but now: Continue reading →

Incinerator forces Harrisburg to sell off parking lots

After defaulting on its incinerator bonds, Harrisburg, PA, gets even more desperate and starts selling off pieces of itself.

William Alden wrote in huffpo 15 June 2011, Harrisburg’s ‘Bad Deal’: City Forced To Pursue Parking System Lease Despite Fears:

The finances of Harrisburg, Pa., are so desperate that local officials are considering a deal they fear will ultimately make the city more miserable.

A state-appointed panel, charged with crafting a financial recovery plan for the city, announced this week that Harrisburg must pursue the sale of public assets to help resolve its fiscal crisis. The nearly-bankrupt state capital, weighed down by debt more than four times the size of its budget, “is not in control of its own destiny,” the state team said in a report.

Three years ago, confronted with a similar budget shortfall, the city considered leasing parking garages and meters in exchange for quick infusion of cash, but that deal was never approved. Last month, the offer resurfaced when New York-based developer LambdaStar expressed renewed interest. Some city leaders harbor a growing fear that Harrisburg will be forced into a deal that will bleed its coffers over the course of decades, after it surrenders valuable assets to a profit-driven company with the power to raise rates on a captive base of customers.

But those misgivings may not matter, as a budget crisis chokes Harrisburg into submission.

“This is a situation where Wall Street will get paid, and the little guys on Main Street, taxpayers, are going to get stuck holding the bag,” Harrisburg City Council Member Brad Koplinski said.

Couldn’t happen here, right? Our local governments would never hastily approve bonds that could force raising taxes or default, would they? Oh, right: they already did.

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Harrisburg defaulted on incinerator bonds

Last year Harrisburg, PA defaulted on bonds it issued to build an incinerator, according to Aaron Smith in CNNMoney, Harrisburg, Pa., defaulting on its bonds:
The capital city Pennsylvania is broke and will be skipping this month’s multi-million dollar bond payment.

On Sept. 15, Harrisburg, Pa., was scheduled to make a $3.29 million payment on the bonds it issued to build a trash plant. But, the cash-strapped city doesn’t have the dough.

“The city’s budget is in deficit,” said Chuck Ardo, spokesman for Harrisburg Mayor Linda Thompson. “We’re looking for ways to trim the budget just to keep services going.”

“Now the chickens have come home to roost,” the mayor said in a statement released Wednesday.

You remember, “Officials here decided seven years ago to borrow $125 million to rebuild and expand the city’s enormous trash incinerator….”

Well, that could never happen here, could it?

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Biomass down for now: next?

Congratulations to all who worked against the biomass plant: today was the deadline on its most recent extension, so it’s gone for now. Congratulations to WACE and SAVE and NAACP and New Life Ministries and everyone else who was involved, especially Natasha Fast, Seth Gunning, and Brad Bergstrom, who were working against it before almost anyone else.

Congratulations to those who were instrumental even though they were not exactly or originally biomass opponents, especially Ashley Paulk, who came out and said what needed to be said, and George Bennett, who was willing to admit in public that he was one of the earliest proponents of the biomass plant but new knowledge caused him to think differently.

A big shoutout to the VSU Faculty Senate, the only traditional non-activist body that went on record as opposing the biomass plant with an actual vote before the extension deadline. The VSU Faculty Senate did what the Valdosta City Council, the Lowndes County Commission and the Industrial Authority Board would not. Go Blazers!

A special strategic mention to Kay Harris and David Rodock of the Valdosta Daily Times, who came to realize they were not being told the whole truth by the Industrial Authority. The VDT even gave a civics lesson on how to stop the biomass plant.

And a very special mention to the people who did the most to make the name of biomass mud in the public’s eye: Brad Lofton, Col. Ricketts, and the VLCIA board. Without their indoctrination sessions and paid “forum” and stonewalling, people wouldn’t have been turned against that thing nearly as fast!

Yet it ain’t over until it’s over.

According to David Rodock in the VDT today: Continue reading →

Why biomass will never cleanly end —jsq

In Harrisburg, PA, same size as Valdosta, in a county of similar size, a trash incinerator bit the dust once, but got revived anyway, and will now probably only go away because: Harrisburg, PA loses solvency and trust over incinerator. There are many parallels here, especially the old boy network. However, the main point I want to draw everyone’s attention to at the moment is that although local activists may have gotten that incinerator closed down once, it came back anyway.

Why? Because their local old boys thought it would make money, and Continue reading →

Harrisburg, PA loses solvency and trust over incinerator

Michael Cooper wrote in the New York Times on 20 May 2010 about An Incinerator Becomes Harrisburg’s Money Pit:
HARRISBURG, Pa. — Officials here decided seven years ago to borrow $125 million to rebuild and expand the city’s enormous trash incinerator, which the federal government had shut down because of toxic air pollution.

But the incinerator burned through the money faster than the trash, leaving Harrisburg residents feeling like they were living through a sequel to the 1986 movie “The Money Pit.”

There were contractor troubles, delays, cost overruns and squabbles. The city borrowed tens of millions more, shoveling good money after bad into the job.

The Patriot-News Editorial Board wrote on 12 April 2010 about Harrisburg incinerator fiasco deserves an investigation to understand how it happened:
Over nearly a decade, officials at the Harrisburg Authority and City Hall made a series of decisions that sought to get the trash incinerator working and profitable, but which instead brought Pennsylvania’s capital to the brink of bankruptcy.

The 2003 deal that took on $125 million in debt to repair the incinerator neglected to include a performance bond.

Inexperienced firms were hired. Fees were paid for work poorly done. Loans were taken on disastrous terms.

Officials were aided, or rather misled, by the advice of numerous attorneys, bankers and engineers apparently far more interested in collecting handsome fees than they were in protecting the interests of taxpayers.

As a result, there is a deep distrust of the fundamental institutions that created this fiasco.

Something else sounds familiar about this situation:
While some of the seats have changed, many of the same people in government today had their fingerprints on these decisions.
It’s the same old boy network locally as approved Sterling Chemical, and the chair of the county commission at that time is now on the Industrial Authority. And the VLCIA has taken on what is reputed to be a $15 million bond issue.

How big is Harrisburg? 50,000 people, same as Valdosta. What is Harrisburg considering? Bankruptcy. Who profited anyway? Local developers.

What’s the moral?

All of the guarantees proved worthless.

All of the fail-safes failed.

What say we have the investigation now, before the fail-safes fail?

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