Governor Corbett is almost certain to sign legislation that places a Receiver in charge of Harrisburg‟s finances after the House agreed to Senate changes and sent the bill to the Governor‟s desk.
The General Assembly acted despite a recent move by Harrisburg City Council to file for bankruptcy. The architects of the Harrisburg „Receiver‟ plan, State Rep. Glen Grell, R-Cumberland and State Senator Jeff Piccola, R-Dauphin, both maintain that the bankruptcy move was illegal.
“The General Assembly approved a bill in June that specifically forbids the city declaring itself bankrupt,” Grell said.
The city‟s bankruptcy filing is under review. A federal judge will hear arguments next month.
The city is $310 million in debt through its investment in a municipal incinerator project and is at risk of defaulting on its payments. Earlier, the House gutted the Receiver measure, SB 1151, and added language agreed-to by Grell and Piccola.
“The original bill turned the finances over to a three-person panel,” Grell said. “We saw two problems with that. It takes longer for three people to agree on a course of action than one person, and we thought we might run into some constitutional issues with taking power from elected officials and giving that power to an appointed commission.”
Under the bill, Governor Corbett will petition Commonwealth Court to appoint a Receiver for the city in the event city council fails within a month of the declaration to adopt a plan to bring the city on the path to recovery. Once appointed, the Receiver will have the ability to create a final long-term recovery plan for the city and will have the ability to implement the plan as needed.