Governor Rendell: Commonwealth Partnering with City of Harrisburg to Help it Meet Immediate Financial Obligations
State's $4.3 million to Help City Pay General Obligation Note; Financial Management Firm
HARRISBURG, Pa., Sept. 12 /PRNewswire-USNewswire/ -- Governor Edward G. Rendell announced this morning that the commonwealth will partner with the City of Harrisburg by providing $4.3 million in expedited payments and economic development assistance and loans. The funds will be used to help the city pay a bond obligation that's due this week and hire a financial management firm to craft a plan to return it to solid financial footing.
The Governor was joined at the news conference by Harrisburg Mayor Linda D. Thompson, Representative Ron Buxton, City Council President Gloria Martin-Roberts, PA Housing Finance Agency Executive Director Brian Hudson, and GreenWorks Development CEO Doug Neidich, representing the Harrisburg business community.
"This is an investment in a vital Pennsylvania city that is in critical need of the state's help," Governor Rendell said. "In return, I can't stress enough how important it is for the mayor, city council and other Harrisburg officials to improve their working relationships to solve the challenges that they face - challenges that affect not just Harrisburg, but central Pennsylvania."
The $4.3 million package announced today includes expedited payments, which were already in process, of $1 million for fire protection and $2.6 million for the annual payment from the Municipal Pension Assistance Fund. Those funds will help the city with its cash flow. The State Treasurer and State Auditor General worked together to expedite these payments to the city.
Another $850,000 will help the city hire Scott Balice Strategies, a financial management firm that will work with Mayor Thompson and city council to develop a comprehensive plan for the city's financial stability. The money includes a $500,000 loan to be repaid when the city's financial situation improves.
Harrisburg is facing a Sept. 15 deadline to make a $3.3 million payment on a refinanced 1997 debt. Before the Governor's announcement today, the city has said it would not be able to meet its obligation.
Governor Rendell said missing the crucial $3.3 million payment is not an option.
"Harrisburg's financial future is still very cloudy, and difficult decisions still need to be made to return this city to fiscal stability. Allowing a missed bond payment, however, would not be a good decision," the Governor said. "It would devastate not only the city, but the school district, the county, and Central Pennsylvania's reputation as a great place to live, work, and play."
The Governor also stressed that bankruptcy should not be an option for Harrisburg until all other options have been explored and exhausted.
Media contact: Amy Kelchner, Governor's Office; 717-783-1116
SOURCE Pennsylvania Office of the Governor
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