The word is bankruptcy. The state capital is in serious financial trouble. It owes $68 million plus in annual payments on a huge trash-to-steam incinerator it built years ago. Yet, the city's total annual budget is only $65 million. Go figure. That's exactly what city officials are scrambling to do, according to a
piece in the Harrisburg Patriot News. Rather than the stigma of bankruptcy, the city has another option: declare itself distress and seek state protection under Act 47. Under that law, the state will advance the money to pay off creditors, etc., but will require the city develop a (painful) plan of cuts and taxes to pay off the money advanced. Other cities have undergone Act 47 reorganizations (Reading and Pittsburgh come to mind) and more will as smaller town and cities wrestle with issues such as high debt, cost of fringe benefits and a declining tax base.
