While still opposing any bankruptcy filing by her own city, Harrisburg Mayor Linda Thompson said she would object to any extension of the Pennsylvania law that limits cities of Harrisburg’s size from a Chapter 9 filing.
A law passed last year as an amendment to the state’s fiscal code restricts certain-sized cities from filing for bankruptcy if they have rejected a financial recovery plan under the state’s Act 47 program for distressed communities.
Some lawmakers are considering extending the ban, which ends July 1.
Last fall, Harrisburg’s City Council filed under Chapter 9, but a federal judge invalidated it, citing the state law and Thompson’s objections.
“I continue to oppose bankruptcy for the city of Harrisburg and remain committed to the court confirmed financial recovery plan. However, should that plan fail to return the city to fiscal solvency — that is, should it fail to liquidate all debt pertaining to incinerator bond transactions, as well as balance the city’s structural deficit — we should reserve the right to petition for bankruptcy protection,” Thompson said in a statement.
Harrisburg’s new state-appointed receiver, retired U.S. Air Force Major General William Lynch, inherits a recovery plan drafted by his predecessor, David Unkovic.
City Council member Brad Koplinski, who favors a bankruptcy filing, calls Thompson’s statement “cheap talk.”
“Her sudden realization that bankruptcy should not be taken off the table shows that she is unable to lead our city,” he added. “She is two years too late.”