Harrisburg last week made a debt-service payment of $305,952 due Nov. 15 on Harrisburg Redevelopment Authority bonds that the city guarantees.
Officials have been working on meeting debt-service costs as it was nearly $127,000 short on the payment and the city's liquidity is limited.
Chuck Ardo, spokesman for Mayor Linda Thompson, said the city made the payment Thursday or Friday morning. He did not have details on how the city came up with the needed funds. "The city transferred those payments to [the bond] trustee," he said.
Thompson last week replaced three Harrisburg Parking Authority board members, potentially halting a proposed bond refinancing and new-money deal that would generate revenue for the city.
The board last month gave its initial approval to refinance by the end of 2010 all of its $105 million of outstanding debt and issue $30 million to $60 million of new-money bonds. The agency would then pass on the bond proceeds to help Harrisburg face its fiscal challenges.
By selecting three new members to the five-member board, the mayor hopes to stop the potential bond transaction. The prior board members' terms had expired.
While refinancing would retain a final maturity of 2037, certain maturities would be pushed out to future years, according to Tim Anderson, partner at Pepper Hamilton LLP, the agency's solicitor.
Extending certain maturities and adding debt to the authority's books could make the city's parking assets less marketable if Harrisburg opts to privatize its parking facilities in order to generate needed revenue.
"The mayor replaced three members of the Parking Authority board whose terms had expired and who didn't feel compelled to communicate their refinancing plan with her administration," Ardo said in an e-mail. "She was concerned that any action by the board could limit her options in developing a comprehensive solution to the city's fiscal challenges."
Pennsylvania's capital city has $282 million of incinerator debt that it cannot repay. It has also struggled to meet payroll and debt-service costs on its general obligation debt.
Thompson last month applied to the state Department of Communities and Economic Development to enter Harrisburg into the distressed communities program, called Act 47. State officials are reviewing that request.
