Harrisburg’s new state-appointed receiver wants the City Council to approve two hires and a tax increase under the proposed financial recovery plan for Pennsylvania’s capital by Monday, or he might ask the Commonwealth Court to force the city to implement them.

That could set up a showdown over a receiver’s ability to force a locally elected body to impose taxes in the state.

“I firmly believe that time is of the essence. Delay does nothing but make the problem worse,” retired Air Force Major General William Lynch said after his first public meeting with the council, on Tuesday. He had written to the council with his requests a day earlier.

Lynch wants to hike the earned-income tax by 1%, to 1.5%, and include in the budget the director of communications and assistant city solicitor positions, at salaries of $75,000 and $55,000, respectively. State officials say the earned-income tax hike could generate nearly $7 million annually. Those provisions, which Mayor Linda Thompson endorses, were parts of a recovery plan that Lynch’s predecessor, David Unkovic, had crafted.

City Council President Wanda Williams said the council is ready to push back. “We are more than willing to work with him, but we don’t work for him,” she said. “General Lynch comes from a culture where you are given orders and you follow them without question. I suspect that’s one of the qualities the Corbett administration was looking for after their experience with David Unkovic’s independence.”

Unkovic quit in late March, citing “political and ethical crosswinds.” Gov. Tom Corbett nominated Lynch to succeed him and the Commonwealth Court approved his appointment on May 24. The state Department of Community and Economic Development oversees the receivership.

“This council does not take orders from DCED,” Williams said.

The council last month approved a separate provision of the plan, the restoration of the chief operating officer’s position, which had remained vacant for more than two years. Former Miami public works director Ricardo Mendez-Saldivia holds the position, at a $110,000 salary.

Harrisburg, population 49,000, is saddled with $310 million of debt it cannot pay related to cost overruns to an incinerator retrofit project. The council has requested a federal probe of the bond deals.

The recovery plan also called for selling or leasing the city’s primary assets, the incinerator, parking garages, and sewer and wastewater systems, by June 30. Unkovic in February had issued requests for qualifications. The six-week gap between Unkovic’s resignation and Lynch’s appointment, however, appears to have compromised that timetable.

Corbett, speaking Tuesday at a press conference, said he hadn’t looked at the Harrisburg recovery plan lately, but accused the City Council of “doing nothing.” He added: “What’s happened in the past is unfortunate, but we’ve got to deal with the present.”

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.