NEW YORK - The U.S. Court of Appeals in Philadelphia has denied the attempt by the Harrisburg City Council to file for bankruptcy on behalf of Pennsylvania’s capital city.
Circuit judges Kent Jordan, Thomas Ambro and Thomas Vanaskie late Tuesday upheld earlier rulings by bankruptcy judges Mary France and Sylvia Rambo that the council’s action violated state law and needed the approval of Mayor Linda Thompson.
City Council attorney Mark Schwartz said he has asked the court to clarify the wordy ruling. “It would have been a lot clearer if they had just said 'appeal dismissed,’ ” Schwartz said in an interview.
Thompson, the state, Dauphin County and major creditors filed motions in the Philadelphia court opposing the bankruptcy.
Harrisburg, which has skipped bond payments related to an incinerator retrofit project, is an estimated $310 million in debt. The city also missed two general obligation bond payments in March totaling $5.3 million.
David Unkovic later that month resigned as the state-appointed receiver. Gov. Tom Corbett last week nominated retired Air Force Major General William Lynch to succeed him.
The Commonwealth Court of Pennsylvania, which must sign off on the appointment, will hold a confirmation hearing on May 24, with Judge Bonnie Brigance Leadbetter presiding.
Schwartz, who has asked the Commonwealth Court to subpoena Unkovic regarding his reference to “political and ethical crosswinds” in his handwritten resignation letter, said whomever Corbett appoints is immaterial.
“I’m bothered by all the corruption that has surrounded the receivership process,” he said. “The citizens of Harrisburg are going to get raped twice. First, through all the bogus bond debt, then later stripped of their assets.”
Unkovic, during his four months as receiver, issued requests for qualifications for companies interested in buying or leasing the incinerator, the parking garages and the sewer and wastewater systems.