Illustration by Rich Hauck.
Welcome to Harrisburg, Pa., site of the world’s slowest gold rush.
In this case, the gold is not the glittery stuff measured in one-ounce bars, but a $13 million pot of cash controlled by Impact Harrisburg, a nonprofit set up as part of the city’s economic recovery plan.
It’s been nearly three years since the concept was unveiled, but Impact Harrisburg has yet to dole out a dime. Basically, it’s been a victim of its own awkward, cautious creation, which has resulted in a slow, bureaucratic creep that threatens to further delay the city’s recovery.
Back in 2013, Impact Harrisburg emerged as one of the more novel ideas of the state-sponsored recovery plan. The state receiver’s team rightly identified two areas—infrastructure and economic development—that could use additional, longer-term funding to get Harrisburg on track towards sustainable progress.
So, it took $13 million from the parking lease deal and dumped it into an account that would be controlled not directly by politicians, but by an independent, nonprofit corporation, which would make decisions on which projects to fund—and how much to fund them.
In theory, this sounded like a great idea, a creative way to avoid a Reed-style stranglehold over the city’s finances—and ensure that money that’s supposed to go to infrastructure and economic development actually does. In practice, however, things have not gone well, at least not so far.
The process of setting up the nonprofit, appointing the nine-member board of directors, getting the go-ahead from the Commonwealth Court and hiring an executive director ate up almost two years. Now, the group is undertaking the drawn-out process of creating application and decision-making guidelines. Once those guidelines are complete and publicized, it finally can begin accepting, considering and approving applications.
The delay wouldn’t be too disconcerting if the city didn’t need access to the money—its own money, by the way. But Harrisburg has decades of unmet infrastructure and other needs that are waiting to be addressed.
The city has identified several priorities for the money.
First, it wants $3.6 million for its ongoing, citywide streetlight upgrade. City Council approved this project last year to remedy the epidemic of streetlight failures, replacing traditional lights with long-lasting LED fixtures. Currently, the project is financed through a bank loan and backed by a guaranteed savings agreement with the contractor. The administration has said that paying for the project upfront would allow it to free up money that could be deployed elsewhere.
Secondly, the administration wants $3 million for matching funds that would allow it to access a larger, $6.7 million PennDOT grant. The nearly $10 million sum would fund a “multimodal transportation project,” which would improve several key roads in the city, including a few hazardous intersections on Allison Hill, and return much of N. 2nd Street to two-way traffic.
Lastly, the administration plans to ask for $6.5 million for buyouts and remediation on behalf of residents of the sinkhole-ravaged 1400-block of S. 14th Street. Interestingly, it plans to make this request from the economic development fund, not from the infrastructure fund, which already would be emptied by the streetlight and transportation projects.
Neil Grover, city solicitor and chairman of Impact Harrisburg, seems confident that the board can act quickly once its procedures are finally in place. He said that infrastructure money should be doled out before the end of this year. He also expects the economic development fund to be drawn down pretty quickly, by the end of 2018.
In general, I support Impact Harrisburg moving quickly to disperse funds once it’s finally able to do so. It’s particularly vital that it approve the $3 million match for the transportation project, which could be a game-changer for the city.
The lighting proposal is, in my view, of lesser concern, due to the city’s guaranteed savings agreement with the contractor. It’s a decent use of the money, but, honestly, those dollars could be used for countless other unmet needs, including water/sewer projects from Capital Region Water, which also is eligible to apply for funding from the infrastructure bucket.
The sinkhole remediation proposal is less convincing, as there’s little clear connection between economic development and turning a part of south Harrisburg into a grassy field. Nonetheless, the residents of S. 14th Street have a real need and a sympathetic cause. Perhaps that money could be split, with some millions going to help the sinkhole victims and the rest for shoring up city-owned assets, such as the Broad Street Market and City Island, which are indeed important attractions and economic generators for Harrisburg.
Back in 2013, Impact Harrisburg seemed like a good idea, as did the thought that its fund would last at least five years. Time, though, has worn away its allure. It now seems more like a bureaucratic slog, an indirect, tedious way of giving the city back its own money—only minus some significant administrative costs (such as $100,000 a year for an executive director).
“I find Impact Harrisburg to be one of the greatest failures of the Strong Plan,” Harrisburg Mayor Eric Papenfuse said recently.
That’s a strong statement, given the many now-evident shortcomings of that plan (parking revenue, anyone?).
Still, it’s a point well taken. What once seemed like a surprisingly fresh, innovative idea has not aged well, slowed to a crawl by process and procedure.
There’s gold in the hills of Harrisburg. Now, if only anyone could get his hands on it.
Lawrance Binda is editor-in-chief of TheBurg.
