News

York County seeks debt extension for impasse loan

Written by Flint McColgan/York Daily Record-Sunday News | Dec 10, 2015 11:10 AM
York_county_mark_Derr.jpg

$8.8 million and interest used to fund state-funded county services in budget impasse are due Dec. 31 if court doesn't extend deadline

(York) -- The York County Board of Commissioners will seek a court order that allows them to extend into 2016 their obligations to pay off debt on a special loan the county took out in October.

The $20 million loan was of the "draw down" variety, which meant it could be thought of somewhat in terms of a credit card, said county spokesman Carl Lindquist. The county could take out money as needed and pay interest only on what it drew.

As of Wednesday, the county had drawn out $8.8 million to support county functions, said county Administrator Mark Derr, including those human services and other functions that are traditionally funded by the state. The county is obligated to pay off that debt by Dec. 31 barring a court order to the contrary.

But all of the county officials agree: This is an unprecedented move.

The county has never had to take out a loan like they did in November nor has it failed to pay off its debts, said Lindquist and county Solicitor Michael Flannelly.

Flannelly said the county will seek the extension because of its inability to pay, because of the hardship of the state not reaching a budget. The loan was originally sought to be used temporarily in the expectation of a state budget.

The county will soon seek out its typical loan of $25 million to fund county operations in anticipation of the year's tax revenue, but that loan will not be able to cover traditionally state-funded services like the $20 million did.

County Treasurer Barbara Bair said she expects the county to draw out all of the $20 million loan.

Even if a state budget can be reached soon, the money won't start flowing down to counties before the year ends, Lindquist said.


This article comes to us through a partnership between York Daily Record and WITF.

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