(Harrisburg) -- After a years-long fight, a state appointee in charge of the troubled finances of the city of Harrisburg says a $360 million restructuring plan is compete.
The effort to bring financial stability to the city has now seen the close of the sale of the troubled Harrisburg incinerator and the leasing of Harrisburg's parking assets for 40 years.
“As cities throughout the country face dire fiscal emergencies, we have never given up on Harrisburg and its people,” Governor Corbett said in a statement. “By working as a team, we have been able to develop strong, cooperative solutions for the people in our capital city.”
Commonwealth Court Judge Bonnie Brigance Leadbetter approved the plan in September, calling it the city's best chance in a long time to get its fiscal house in order.
Under the plan, the Lancaster County Solid Waste Management Authority bought Harrisburg's debt-laden municipal trash incinerator for nearly $130 million.
The recovery plan also calls for about $283 million in borrowing by a state economic development agency to be repaid by receipts from the city's parking lots, garages and meters.
Creditors, meanwhile, have agreed to walk away from potentially more than $100 million.
According to state-appointed receiver, retired Major General William Lynch, the deals remove the $360 million incinerator debt and allow the city to eliminate it's structural deficit.
“While there is still much work to be done, these transactions provide the city officials the tools to craft a predictable and stable economic future,” Lynch says.
Lynch adds the city will have a balanced budget through 2016.
The Dauphin County Commissioners are praising the agreement, saying it sets the stage for economic growth in the city and surrounding region.
“This is a historic day,’’ Chairman Jeff Haste said in a statement. “A lot of hard work went into making this day possible and I’d like to thank Receiver Gen. William Lynch and his team, Mayor Linda Thompson, Harrisburg City Council members and the other creditors for stepping up and getting the job done.”
Haste said the agreement fulfills the commissioners’ promise to reach a fair solution without penalizing the other municipalities in the county or putting an additional burden on residents.
“We have resolved the single greatest financial crisis in our region’s history,’’ Commissioner Mike Pries added. “It wasn’t easy, but we worked together to find a solution that benefits the region now and in the future.’’
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