Financial Agreement Near
The major parts of a deal to resolve Harrisburg’s financial crisis are nearly in place, receiver William Lynch announced last month.
These include sale of the city’s incinerator, lease of the parking assets, negotiations with creditors and final agreements with the city’s trade unions.
Lynch expects most of the remaining issues to be resolved this month, including the sale of the debt-laden incinerator to the Lancaster County Solid Waste Management Authority.
“All the stakeholders involved in the sale of the incinerator are in agreement,” said Lynch, who added that the city’s creditors also finally understand that they must negotiate in earnest and might have to accept less than they’re owed.
In addition, the city must finalize an agreement with the firefighter’s union. The city’s police union finalized a new contract in June.
The goal, Lynch said, was to pay off about $600 million in debt, including $350 million related to the incinerator, while allowing the city to regain fiscal solvency over the long-term.
“This plan will create important new revenue streams to help the city reduce its structural deficit and spur economic growth,” said Lynch. “The parking agreement may very well become a national model.”
Many aspects of a final plan must be OK’d by City Council and then approved by the Commonwealth Court, actions that should begin to take place this month.
HUD Funds Distributed
The Harrisburg City Council last month dispersed nearly $1.8 million in federal funds designed to assist housing and community development.
In the annual distribution of Community Development Block Grant (CDBG) funds, 13 social service organizations received a total of nearly $500,000. Another $550,000 went to various city housing programs.
Community-based organizations that received funds were:
- The Fair Housing Council of the Capital Region: $45,000
- Community Action Commission: $25,000
- Harrisburg Police Athletic League: $25,000
- Latino Hispanic American Community Center: $25,000
- Christian Recovery Aftercare Ministries: $20,000
- Christian Love Ministries: $10,000
- Camp Curtin YMCA: $100,000
- YWCA of Greater Harrisburg: $25,000
- Broad Street Market Corp.: $47,739
- Rebuilding Together of Greater Harrisburg: $25,000
- Habitat for Humanity of Greater Harrisburg: $75,000
- African-American Chamber of Commerce: $10,000
- Harrisburg Housing Authority: $65,000
City programs that received funding were:
- Homeownership Opportunities Program: $100,000
- Home Emergency and Lead Repair Program: $100,000
- Home Improvement Program: $200,000
- Emergency Demolition: $150,000
Lastly, a large part of the funds were used for administrative/debt obligations. Debt service ate up $367,567 of the CDBG grant, while $353,826 was allotted for administration and “indirect” costs.
Auction Proceeds Tallied
Harrisburg recouped about half of what was spent on museum artifacts following a weeklong auction last month on City Island.
Auction sales totaled about $3.1 million for the 8,000 or so items, according to New York-based auctioneer Guernsey’s. Minus the auction fee, the city kept about $2.57 million, money that will pay off a loan taken out in 2006 that used the artifacts as collateral.
Harrisburg had received $1.6 million during two previous sales of another 2,000 items, bringing the proceeds from museum artifacts to $4.17 million. A follow-on auction of historic documents in September should increase that total some more.
Former Mayor Stephen Reed spent at least $8.3 million in public funds on these artifacts in his dream to turn Harrisburg into a museum mecca. Most of the artifacts auctioned were for an “Old West” museum he wanted to build, while some were for a proposed African American history museum.
Zoning Board Rejects 3 Projects
The Harrisburg Zoning Hearing Board last month turned down several proposals, all of which had generated neighborhood opposition.
Bethel AME Church had wanted to re-establish a surface parking lot at its site at the corner of N. 6th and Herr streets.
The historic church, located on the 1700-block of N. 5th St., long occupied the 6th Street site, but its building burned down in 1995. It then ran a commercial parking operation there until 2010, when its special exception, under challenge by the community, was not renewed.
The church’s new pastor, the Rev. Micah Sims, pleaded with the board to allow it to resume renting out parking until it could execute a redevelopment plan. The board, however, sided with members of Fox Ridge Neighbors who argued in opposition, stating the church would have no incentive to sell or develop the property.
In other action, the zoning board:
- Rejected a variance/special exception request by developer Gary Wilson, who wanted to construct two two-family houses on vacant land at 1308 Green St. Neighbors testified in opposition, saying that four rental units were not in the best interest of the community.
- Rejected a variance request from developer Paul Peffley to locate a convenience store/deli on the ground floor of an historic building he’s redeveloping at the corner of N. 3rd and Hamilton streets. That application met with opposition from residents of Engleton, who feared a negative impact on their neighborhood.
- Approved a variance to turn the ground floor of the former Barto Building, at N. 3rd and State streets, into restaurant and retail space. Brickbox Enterprises would like a restaurant to locate in the former Barto Building, which the company is transforming into the LUX condominium building
- Approved a variance to allow a church, Iglesia Pentecostal Jesucristo La Roca, to locate at 913 N. 2nd St., which once housed La Kasbah restaurant.
Mayor, Treasurer Clash over Fund Transfers
Harrisburg Mayor Linda Thompson last month asked for a significant increase in the amount of money her administration can reallocate without approval by City Council, a request that drew strong opposition from city Treasurer John Campbell.
Thompson asked for permission to transfer as much as $50,000 within the approved budget without the consent of council, up from the current level of $20,000.
The request prompted Campbell to write a strongly worded memo, urging council to deny the request.
“While this legislation may seem like an opportunity to allow for great flexibility in spending by the administration, it is my opinion that this legislation will only reduce the proper controls that are presently in place and exercised by City Council,” Campbell wrote. “If this legislation were to be approved, budget transfers would begin to become more frequent and thus negate the importance of passing a proper and reasonable budget annually.”
Every year, the council approves numerous reallocations, as some departments spend more or less than budgeted during the year. Campbell fears that increasing the reallocation threshold to $50,000 would give the administration too much leeway to transfer large sums of money outside of the regular budget process and without proper oversight.
The administration’s proposed ordinance was sent to the council’s Budget and Finance Committee for further review and possible action.
$5 Million for Fire Protection, $0 for Revitalization
Harrisburg received a split decision from the state last month, as the legislature approved a record $5 million in fire protection funds, but excluded the city from a new revitalization program.
City officials were pleasantly surprised—even shocked—by the $5 million allocation in the 2013-14 budget, meant to offset the city’s costs of protecting the Capitol complex from fire. That figure is double the amount allotted last year and far more than the $496,000 that House Republicans had approved in their budget plan.
Harrisburg’s state legislators were pushing for $4 million, but late lobbying by receiver William Lynch upped that amount by another $1 million, said state Sen. Rob Teplitz.
The money technically goes to secure the state’s 40 buildings from fire, accounting for the bulk of the Harrisburg Fire Bureau’s $8.4 million budget. However, it actually flows to the city’s general fund, which frees up money for other uses by the highly indebted, insolvent city.
As the state was giving, it also was taking away, as it purposely excluded Harrisburg from participating in a just-launched revitalization program.
The new state budget funded a City Revitalization and Improvement Zone program, which will funnel money to small cities each year to assist in the redevelopment of distressed areas. However, language in the law prohibits any city under state receivership from participating, a designation that applies only to Harrisburg.
Kiosks, Online Payments Come to Harrisburg
Harrisburg bill-payers have several new options available to them, as two computerized payment kiosks, as well as an online payment system, came on line last month.
The two kiosks are located in City Hall outside the city treasurer’s office and at the Giant Food Store in Kline Village, said Treasurer John Campbell, who added that a third kiosk would be located in a yet-to-be-determined location Uptown.
Denver-based EZ Pay Corp. is providing the kiosks at no cost to the city, said Campbell.
In addition, bill-payers now can pay online at www.harrisburgpayments.com or by calling 888-243-3456. Campbell said he expected the online bill-paying portal to be integrated with the city’s website soon.
Through these mechanisms, residents can pay most common bills, including for utilities, property taxes and traffic fines. A convenience fee will be added to each payment based upon the amount of the transaction, averaging $3 for most utility bills and $1 for most parking tickets, said Campbell.
Campbell expects the city, the Harrisburg Authority and the school district to save “at least” $80,000 a year by not having to pay the credit card transaction fee.
City to Receive State Loans
Harrisburg last month was awarded state funding for two major infrastructure projects, including for utility repair at the Uptown sinkhole site.
Harrisburg received a $900,000 low-interest loan through PENNVEST for repairing water and sewer infrastructure damaged by the sinkhole on the 2100-block of N. 4th Street, said state Sen. Rob Teplitz.
In addition, the Harrisburg Authority received a $26 million low-interest loan, administered by PENNVEST, for upgrading the city’s wastewater treatment facility, said Teplitz.
The improvements will bring the plant’s ammonia and nutrient reduction requirements into compliance with U.S. Department of Environmental Protection regulations. This $53 million project also will receive $26.7 million in outside financing and a $973,000 H20 PA grant, Teplitz said.
MLK Street Renaming on Hold
Harrisburg’s financial crisis seems to have doomed another proposal: the effort to supplement the name of N. 2nd St. downtown by adding “Rev. Dr. Martin Luther King Jr. Boulevard.”
Last March, the administration made the proposal, which the City Council then sent on to the council’s Public Works Committee.
Committee Chairwoman Sandra Reid said she was in favor of the change, which would give the historic street both names from Chestnut to Forster streets. However, the $6,000 to $8,000 cost of replacing 63 street signs could not be justified, she said.
“We have an ongoing concern that our parks and waterways are not being maintained,” she said.
Last year, park maintenance was transferred from the city’s Parks and Recreation Department to the Public Works Department, which since has been criticized for lax maintenance, particularly in Riverfront Park.
Miller: Still In Mayor’s Race
City Controller Dan Miller last month took a step towards running for Harrisburg mayor as a Republican, filing an affidavit affirming his eligibility for the office.
Miller lost in May in the Democratic primary to businessman Eric Papenfuse. However, he won the Republican nomination by gaining 196 write-in votes.
As of press time, Miller hadn’t yet paid the $25 filing fee, which must be received by the Dauphin County Office of Elections and Voter Registration by Aug. 12.
If he decides to run, Miller will face independent candidates Nevin Mindlin and Nate Curtis, in addition to Papenfuse. The general election is slated for Nov. 5.
Leak Won’t Close Jackson-Lick Pool
An Uptown pool will be open for the remainder of the summer after a major leak was quickly repaired.
City officials feared the Jackson-Lick pool, located at 1201 N. 6th St., would have to close after it lost about 450,000 gallons of water in a week.
“The city considered closing the pool,” said COO Robert Philbin. “However, we were able to keep the pool open while resolving the problem. City Engineer Paul Francis was able to locate and stop the pool water leakage with the assistance of a diver from the Harrisburg River Rescue.”
The city’s other public pool at Hall Manor on Allison Hill has been shut since last year after persistent leaks led to the finding that its foundation must be rebuilt.
The city’s Engineering Bureau is preparing a maintenance and repair plan to bring both pools back to full operation next season, said Philbin.
Farmers Co-op Debuts
Harvest, a new farmers cooperative, opened last month in the brick building of the Broad Street Market, bringing fresh produce and other goods to Harrisburg from more than a dozen area farms.
The co-op is the brainchild of developer Josh Kesler and chef Matthew Hickey, who is managing the business on a day-to-day basis.
“Our commitment is to build a relationship between the farmers and local consumers, providing healthy, sustainable local food, as well as helping to revitalize the Broad Street Market, which we believe will regain its position as the breadbasket of our region,” said Kesler.
The stand itself is unique for the Market, built from reclaimed lumber from the Stokes Millworks building across the street. Kesler recently bought that building and has begun renovating it for a farm-to-plate restaurant, which should open late next year.
New School in Strawberry Square
This month, the nonprofit Aegis Education Endeavor (AEE) will open in Strawberry Square, offering a new cyber charter school that “combines art, athletics and industry.”
The 2,800-square-foot facility will take space at 306 Market St. in downtown Harrisburg. Aegis is partnering with Achievement House Cyber Charter School, a public online school chartered by the state to serve students in grades 7 to 12.
In addition to an education program, Aegis will offer activities to cyber school students and to students learning at home, public or private schools, said founder Denni Boger.
“Strawberry Square is the perfect site for AEE because it is centrally located to be available to students from surrounding school districts who may wish to use public transportation to access the facility,” said Boger.
Aegis will hold an open house and orientation at its new facility on Aug. 7, 1 to 7 p.m.
Adrian St., 2256: Burner Properties LLC to B. Britton, $57,000
Bellevue Rd., 1921: A. & S. Jawhar to CNC Realty Group LLC, $63,500
Cumberland St., 114: B. Cohen to L. Larrieu, $132,000
Green St., 1925: F. Shannon to W. Gonzalez, $215,000
Mulberry St., 1158: E. Grill to S. Elazouni, $59,900
N. 3rd St., 1702: Fannie Mae to M. Mayhew, $75,000
N. 5th St., 1732: Freddie Mac to B. Harris, $100,000
N. 6th St., 2559 & 2561: Deutsche Bank Trustee & Company Americas Trustee to V. Acosta, $31,500
N. 20th St., 32: U.S. Bank Trustee & Pa. Housing Finance Agency to G. Carter & V. Diaz, $52,400
N. Front St., 1705: Rolleston Corp. to WCI Partners LP, $400,000
N. Front St., 2515: Centric Bank to 324 Mishika LLC, $175,000
Penn St., 1716: B. Andreozzi to D. Rhodes, $131,000
Reily St., 311: R. Heath to S. McLearn, $85,500
Rudy Rd., 2465: P. Lemmo to R. Harper, $75,000
Sayford St., 235: R. DeLong to JLS Rentals LLC, $35,000
Showers St., 612: D. & S. Hickethier to M. Murphy & V. Halchak, $166,000
S. Front St., 317: M. & J. Hankins to M. Homa, $115,000
Swatara St., 1321: D. & J. Boyle to J. Rodriguez & J. Vasquez, $33,900
Sycamore St., 1520: L. Miller Jr. to M. Brunner, $97,500
Wallace St., 1529 & 1531; 1513, 1515 & 1517 N. 6th St., $144,100: Buonarroti Trust to U.S. General Services Administration, $144,100
Source: Dauphin County, for sales exceeding $30,000. Data is assumed to be accurate.