Harrisburg, Pennsylvania, which has missed $6 million in debt payments since Jan. 1, should consider seeking Chapter 9 bankruptcy protection, City Controller Dan Miller told a three-hour special committee hearing.
John Moorlach, who became treasurer of Orange County, California, after it filed the biggest municipal bankruptcy in U.S. history in 1994, has some advice for the new record-holder, Jefferson County, Alabama.
Stephen Reed, Harrisburg’s mayor for 28 years, pushed Pennsylvania’s capital into insolvency as the more than $500 million in bond deals he oversaw to finance community development drained city coffers.
Harrisburg’s notice of a second general-obligation debt default contrasts the way distressed cities are dealt with in Pennsylvania compared with Rhode Island, according to Matt Fabian of Municipal Market Advisors.
Harrisburg, Pennsylvania’s city controller, treasurer and council president asked a judge to reject a proposal to fix the city’s budget problems by selling or leasing the capital city’s most valuable assets.