The Harrisburg, Pa., City Council has launched another legal attempt to fight receivership in Pennsylvania's distressed capital city.
In a filing in U.S. federal court on Tuesday, the council, city Controller Dan Miller and city Treasurer John Campbell argue that the receivership law, which the state legislature passed last year, violated the equal protection clause of the 14th Amendment to the U.S. Constitution.
They also maintain that the legislature violated the Pennsylvania constitution by improperly delegating its constitutional responsibility to the governor. "Act 47 as passed by the legislature does not allow the commonwealth's executive branch to simply seize the policymaking power of the local governing body," the group said in a statement.
Act 47 is the distressed municipalities law, under which such communities can enroll for a state workout program. Harrisburg joined Act 47 in December 2010, but the City Council last year rejected a proposed financial recovery plan three times, prompting Gov. Tom Corbett to push for a law calling for receivership.
The lawsuit seeks immediate relief from the recovery plan drafted by original receiver David Unkovic and now under the watch of Unkovic's successor, William Lynch. It calls for the sale or lease of city assets, including the incinerator for which bond debt has reached about $300 million; an increase in the earned income tax to 1.5% from 0.5%; and renegotiating municipal union contracts.
The council attempted to invalidate the receivership when it filed a Chapter 9 bankruptcy petition, but a federal judge invalidated the filing in November.
Kennett Square, Pa., attorney Paul Rossi filed the lawsuit. Rossi represented three Harrisburg citizens, including former mayoral candidate Nevin Mindlin, in a similar lawsuit, but U.S. District Judge John Jones III said the three lacked legal standing.
"Instead of challenging that ruling to the Third Circuit and wasting a lot of time, the majority of City Council members stepped forward and offered their time and efforts," Rossi said at a City Hall press conference. Rossi said the receivership law, which restricts bankruptcy options for third-class cities under the state's population tiers, unfairly singled out Harrisburg.
Speaking before the Municipal Financial Advisory Committee on Wednesday morning, City Council President Wanda Williams called the receivership "fundamentally un-American and clearly undemocratic."