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TheBurg is a free monthly newspaper that begins to tell the stories that, put together, describe the community of greater Harrisburg: the people who live, work and travel here; the families that make their home here; the merchants that do business here.

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May 2012

Shipoke: Ready for Its Close-up

Networking for Success

Downtown Goes Residential

A Taste of the Big Easy

Local Books, Film, Music

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Past Issues

TheBurg began covering the Harrisburg area in January 2009. All of our past issues are available to read as PDF files.

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Harrisburg Area News

Court Denies Police Pension Appeal

May 16 -- The Supreme Court of Pennsylvania has denied an appeal filed by the city's police union, ending a two-year legal battle over whether union members were entitled to a pension increase that former Mayor Stephen Reed granted as he was leaving office.

Last November, Commonwealth Court Judge Bonnie Brigance Leadbetter upheld a previous decision by the Pennsylvania Labor Relations Board that the city does not have to honor an agreement the Fraternal Order of Police reached with Reed in 2008.

That agreement would have cost the city about $500,000 in additional salaries and pensions per year by extending an existing contract until 2015.

Though Reed negotiated the deal, the City Council never approved it, leading the FOP to file an unfair labor practice claim.

The ruling has significant implications for Harrisburg, as re-negotiating union contracts is a key element of any comprehensive financial recovery solution.

“This decision finally shuts the door on this case," said acting City Solicitor Jason M. Hess. “Vigorously defending this appeal was a priority initiative assigned to the Law Bureau as part of the city’s financial recovery plan.”

New Receiver Named for Harrisburg

May 11 -- A military man, retired Maj. Gen. William B. Lynch, today was nominated as Harrisburg's new receiver, the person charged with guiding the city to financial solvency.

Lynch, the former adjutant general of Pennsylvania, introduced himself at a short afternoon press conference, stating that he would work hard to solve Harrisburg's debt crisis.

"This seems to be something that needs to be done," he said. "It seems to be something that can be done."

Lynch, 69, admitted that he had no experience in accounting or municipal finance, but said that he felt qualified for the post due to his background working with large, complex budgets as the long-time head of the state's National Guard.

Lynch, who lives in Hazleton, Pa., now must be confirmed for his post by the Commonwealth Court, which is expected to hold a hearing on his nomination within 15 days. He replaces bond attorney David Unkovic, who abruptly resigned on March 30 after claiming that Harrisburg's finances were a "house of cards" marked by decades of mismanagement and possible corruption.

Since then, the Officer of the Receiver has been administered by Fred Reddig, an official with the state's Department of Community and Economic Development.

Lynch said he now needs to study the many complex issues surrounding Harrisburg's financial crisis.

The city owes about $317 million due to multiple upgrades over many years to its incinerator. It also has large and growing annual budget deficits.

Lynch enters the process mid-stream, as efforts are well underway to monetize the city's assets to help retire its massive debtload.

Multiple companies already have made bids to buy the incinerator, lease the city's parking assets and manage its water/sewer system. Those proposals are now being evaluated, and negotiations with the finalists are expected to begin soon so that deals can be finalized by the end of June.

The Washington, D.C.-based law firm of McKenna Long & Aldridge has been handling much of the day-to-day work implementing the recovery plan drafted by Unkovic.

As part of his duties, Lynch said he would engage the community, but did not specify when or how.

"My intention is to meet with the people who are interested in this problem," he said.

The nomination received mixed reactions from city officials.

Mayor Linda Thompson was immediately supportive, saying Lynch was “just the kind of strong leadership the fiscal recovery of our city needs at this time. I spoke with Gen. Lynch this morning, and I welcome him and look forward to working closely with him.”

Councilman Brad Koplinski was more skeptical.

"I hope that Gen. Lynch will be giving orders rather than taking them," he stated. "He should join Mr. Unkovic in demanding our creditors do right by the city of Harrisburg."

Council Again Defies State, Refuses to Fund Spokesman Job

May 8 -- In another swipe at the state, the Harrisburg Council tonight refused to fund two more positions mandated in the city's financial recovery plan.

The council did not vote on a resolution that would have funded the positions of director of communications and assistant city solicitor.

Council members used the same reasoning as last week, when they refused to vote on the nomination of Ricardo Mendez-Saldivia as the city's new chief operating officer/chief of staff.

They said they would not act until the state Department of Community and Economic Development (DCED) briefs the Commonwealth Court on the status of the court-approved financial recovery plan. DCED must file an update with the court by Friday.

"They need us to be able to pass these items and move on with the plan," said Councilman Brad Koplinski. "We're demanding answers over why Mr. Unkovic left and what's the status of the plan."

By Friday, DCED also is slated to update the court on the search for a new city receiver, a job left empty since former receiver David Unkovic suddenly resigned on March 30.

Council members have repeatedly said they want Unkovic to testify over why he resigned his post. Since then, the receiver's office has been run by DCED official Fred Reddig.

Koplinski said that the assistant solicitor position is widely supported by council, but that "that person is nowhere near being hired," removing any urgency to fund the post.

The council is less supportive of the city spokesman job, which it cut in its 2012 budget. Unkovic reinstated the $75,500 position in his financial recovery plan, but the council has yet to act on it. Since January, city spokesman Robert Philbin has been working without pay.

The council did make other budget moves tonight. One budget change transferred $2.1 million within the city's sewer fund to pay for certain system contracts.

It also transferred $80,000 to the Fire Bureau so that eight new firefighters can begin a training class on June 4. The bureau recently has been hit with a rash of retirements, as veteran firefighters have become concerned that their pensions may be in danger as a result of the city's financial crisis.

These retirements have created staff shortages and exacerbated the existing problem of excessive firefighter overtime.

Takeover Redux: State Again Eyes Harrisburg Schools

May 3 -- State Sen. Jeff Piccola is due to retire in a few months from a long legislative career, but not before setting the stage for a possible third takeover of a Harrisburg entity.

Piccola is the primary sponsor of SB1450, which would allow the state to assume control of a school district deemed "distressed."

The bill, currently in the Senate's Education Committee, would set up an "Office of Financial Recovery" headed by a chief recovery officer, who would draft and implement a financial recovery plan. The officer would report directly to the state's secretary of education.

If the school board refused to cooperate with the chief recovery officer, the state could appoint a receiver, who would directly run the district.

The bill potentially could apply to many school districts, but Harrisburg is one of the few districts in the state that soon could set off one of the triggers for a takeover, which include an inability to pay teachers on time, a request for an advance on state basic education funding and a default on a bond.

The Harrisburg school district is deeply in debt, with a budget deficit for the 2012-13 school year estimated at $16 million.

In 2000, Piccola engineered another takeover of Harrisburg's schools, which then were placed under the control of former Mayor Stephen Reed. That 10-year mandate expired in 2010, leaving the district with a debt bomb that is estimated to grow to more than $500 million by 2020.

Last year, Piccola also sponsored legislation that led to a takeover of the city government, which now is overseen by an official of the state Department of Community and Economic Development pending appointment of a receiver by Gov. Tom Corbett. The new schools legislation is similar to that bill, as it appoints one person to head a financial recovery office, which then would draft and implement a financial recovery plan.

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