Harrisburg Mayor Linda Thompson Wednesday proposed selling land underneath three parking garages to the Harrisburg Parking Authority to help fill a $4.3 million gap-error in her fiscal 2011 budget proposal.

The administration failed to include debt-service costs in the mayor's spending plan on Series 1997D and F general obligation refunding bonds, Thompson spokesman Chuck Ardo said.

Selling the lands to the parking authority would fill the $4.3 million gap, as the assets are valued at $8 million, according to Ardo.

Both Ardo and Tim Anderson, a partner at Pepper Hamilton LLP, the parking authority's solicitor, said the initiative could involve the authority issuing bonds. It would then use those bond proceeds to pay Pennsylvania's capital city for the lands.

"That's certainly one likely way of doing this," Anderson said.

He noted that the proposal is not a new idea, but the parking authority's board would need to weigh in on the issue. Its next meeting is Dec. 16.

Thompson's budget proposal also includes selling real-estate tax liens from 2005 through 2009, worth $1.9 million, to Dauphin County. Ardo said the property sale would eliminate that proposed tax-lien sale. It would also restore nine firefighter positions.

Harrisburg is waiting to hear if the state will allow the city to enter into its distressed municipality program, called Act 47. The city has $282 million of incinerator debt that it did not pay debt service on in 2010. The 2011 budget plan does not include incinerator debt-service payments.

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.