In a February article in the Harrisburg Patriot Times the Governor had this to say about the financial woes facing the state’s capital city, woes that raised the possibility of Act 47 and possibly Chapter 9 bankruptcy: “there’s no easy, pain free way out…there is no Santa Claus riding into the aid of the city”.
Perhaps it was the fact that back in February the Governor, like most people, was not in the spending mood due to the post-Christmas spending hangover. Because just this week the state announced it is riding in to rescue Harrisburg with a $4.4 million package that will help the city to avoid missing a payment on its bond debt and hire a consultant to help steer the City to financially calm waters.
But don’t call it a bailout because according to the Governor the package includes money Harrisburg was due anyway like its municipal pension aid ($2.6 million) and money the City gets for protecting the State Capitol complex against fire ($1 million). There is also money from a loan fund that must be paid back ($500k). “We’re just front loading it and expediting it” not bailing the City out, said the Governor, who felt that it would be disastrous for Harrisburg to miss the debt payment. How the City is able to use what appears to be restricted money to pay a debt is not clear.
And rest assured that the money is just there as a temporary step so the City and its consultant can come up with a long-term solution. Just like flexing highway money did for the Port Authority.
Some of the early Christmas cheer must also be extended to the City from banks or foundations because even with the cash infusion the Mayor noted that they are still $500k short of making payroll.
