Tag Archives: William Lynch

Waste Not: A Q&A with LCSWMA CEO Jim Warner.

June 29, 2018 | by Lawrance Binda

Jim Warner

In 2013, Jim Warner saw a big opportunity—one that required a big risk.

He led his organization, the Lancaster County Solid Waste Management Authority, in making a major acquisition—the financially distressed Harrisburg incinerator. Since then, LCSWMA has invested millions to upgrade the plant and the property, transforming it into the Susquehanna Resource Management Complex, a state-of-the-art waste-to-energy complex.

At year-end, Warner plans to retire as LCSWMA’s long-serving CEO. So, we asked him to reflect on his past and on the career-defining decision to acquire the debt-ridden Harrisburg facility. This interview has been edited for clarity and space.

TheBurg: How did you get into this industry?

Warner: I got out of graduate school in 1984 from Ship [Shippensburg University] with a degree in environmental science. I got a job in Gloucester County (N.J.) as one of the first county recycling coordinators in America.

TheBurg: What year was that?

Warner: That was 1985, when the “garbage crisis” first manifested itself, in New Jersey. So, government responded by saying, “Well, maybe we should recycle part of the waste stream, and we wouldn’t have as big of a problem.” So, counties in the mid-‘80s began hiring . . . professionals to manage and implement recycling programs in a region or a county. Then Lancaster became the first county [in Pennsylvania] to write a comprehensive waste management plan, in 1986.

TheBurg: Where were you from originally?

Warner: I grew up in Lebanon, Pa.

TheBurg: So, you were coming back home?

Warner: Not only that. I went to Millersville for my undergrad and, actually, most of my best friends were from Lancaster. My senior year, I lived in downtown Lancaster. So, yeah, I was coming back. I’ve been here for basically 31 years.
TheBurg: So you became Lancaster County’s recycling coordinator?

Warner: I did. I was like the third or fourth employee in the office. And, during that time, we borrowed a lot of money and built a waste-to-energy plant, built the first double-lined landfill in 1988 and then implemented a recycling program. That year, July 1988, is when Pennsylvania passed their mandatory recycling law under Bob Casey’s administration.

So, I set up the recycling and hired an assistant or two. And my desire was to really get into the business component more. So, then, as we grew, I had a series of promotions and more responsibility until about 1994 or ‘95, when I was sort of the general manager. Then our executive director at the time made a pretty quick exit, and the board of directors decided that I was capable enough to manage the system as it was then, which was not nearly as complicated as it is now. So, as a young 38-year-old, I became executive director and, eventually, my title changed to CEO. The organization went from about $35 [million] to—I wouldn’t doubt if we did $90 million this year and 350,000 tons to 1 million. Some of that was organic, but a lot of it was strategic. Probably the biggest piece ever in that evolution was the acquisition of Harrisburg [incinerator], as far as a big chunk of business.

TheBurg: Let’s talk about Harrisburg then. Take me through the process of how you ended up buying the incinerator here.

Warner: It’s really interesting. As we had a growth spurt from the mid-‘90s to about 2005, we were growing at about 3½ percent per year. So, as we projected that out, it looked like we were going to run out of processing capacity in the Lancaster plant somewhere around 2010.

So, then a couple of things happened. That growth stopped suddenly in about 2007, with the recession. We started evaluating—how would we expand the Lancaster facility?

We started looking at—what would be the cost of doing that expansion? And we had a good model, in that two very similar plants in Florida—one in Hillsborough County and one Lee County—had just gone through that process, where they built a fourth unit. Each one added a 600-ton unit, and their plants went from 1,200 to 1,800 tons per day. And each of the projects cost about $135 million. So, we started modeling about $150 million, figuring we would come a decade after them.

When you do that, there’s sort of a Catch-22. If you put in a 600-ton-per-day unit, that’s 180,000 tons per year of waste going through that unit. The problem is that, when you build a unit, you don’t necessarily have 180,000 tons of waste coming in the day you open it because, if you had, you would have been landfilling all that waste until the day you open the unit. And we never wanted to get into that, where we grew so much but we waited until we could fill the unit with Lancaster County waste. The price to pay would have been too much landfilling of waste. It would have eaten up years of landfill capacity.

So, the other option is, maybe wait until you have 20,000 or 30,000 tons, and then you go and get the other 150,000. And getting the other 150,000 and bringing it in, would have been very difficult to do. And the price we would have gotten for what we call spot trash in the industry wouldn’t have supported the cost of adding a unit like that. We bought some time then because of the Great Recession, and, meanwhile, the timing of Harrisburg’s distress was progressing.

Now, at the time, the [Harrisburg] receiver [William Lynch]—he’s trying to get the highest price possible because there’s $370 million of indebtedness on the plant. [He] wanted an inflated price for the asset, which would be supported by guaranteed waste streams at above-market rates for 20 years, with put-or-pays—guaranteed amount to LCSWMA every year—in exchange for an over-inflated price for the asset. He needed $130 million because they could only value the parking [asset] at $240 million. So, those were the two assets they had: 130 for this, 240 for that.

So, all along, we had asked them—what do you want paid? Because we could make it $100 million, we could make it $80 million, we could make it $130 million. But then here’s what your tipping fees are going to be over 20 years, and the guarantee levels change the valuation. What were they willing to accept as their tipping fee? So, Dauphin County, I think we started at $85, and the city started at $190. But the market is $50, $60. And there was a lot of push/pull there between the city and the county. If you had a blended rate, the city and the county would both be paying $120 or something like that. But that wasn’t going to happen because the county didn’t feel they had as much responsibility for the mess as the city did.

But we tried to stay out of that. We were just coming in and trying to make the asset work for us and, if we could help solve this neighboring problem, that would be good, too.

TheBurg: It seemed to me, at the time, that everything seemed to align together in a serendipitous way.

Warner: If we hadn’t come in, I don’t know how the city would have avoided bankruptcy.

I think the first number we gave them was like $47 million, and people had the impression we were low-balling, but we were giving an at-market price without the guarantees. But, when all of a sudden, they wanted $130 million, then the tipping fees were going to go way up, and the guarantees had to be made on the revenue because we’re paying 20 years forward. We gave them $130 million one Monday morning—Dec. 23, 2013—on the guarantee that they’re going to be paying us some rate times some amount of tons every year for 20 years. And we can never bring that risk to our doorstep, because they got their over-inflated price that morning.

Our risk was that we had to continue to make the asset function for those 20 years. For that, we were relying on our own expertise and know-how of being in the business, and that was a risk we were willing to take on.

TheBurg: So, you bought this thing. What came next?

Warner: I think we’ve put about $22 million in, in the first four years. We added some things that we didn’t think we were going to—we could get by. And there are other things that we didn’t do that don’t need done. This building we’re sitting in, we call it the TMA building, which stands for Transfer, Maintenance and Administration. So, we built this bigger than we had thought. We built 23,000 square feet. We have two transfer bays.

And the reason we made it much more robust than we originally thought was because, the more we thought about it—our arrangement with the city of Harrisburg and Dauphin County is that we’re going to take your waste for the next 20 years. What happens if the main asset doesn’t function? Believe it or not, just in March, we went four days without a unit working because, well, everything seemed to go wrong for four consecutive days. But all the waste came here, the trucks dumped in the transfer building, and we transferred it all to our Lancaster waste facility.

When THA (the Harrisburg Authority) had the plant come down, they would just say, “Take your waste elsewhere. We’re not open.” We, first of all, can’t do that. But, secondly, we don’t want to do that because we want that revenue. With our assets, we can manage it, so that’s why we can do that.

So, this building was $5 million. We just finished a $4 million cooling tower. We thought we could put a Band-Aid on the old tower every five years. But we just decided to abandon the cooling tower. The cooling tower here was built for like a shopping center, not a power plant. So, we put in a real cooling tower. So, now we don’t have to worry about whether, over the next 20 years, it’s going to work. Then we’ve done all this site work. We changed the entrance from Cameron Street to 19th Street. We put in a new scale house. We paved the roads, new fencing, landscaping. All that was a couple million dollars. Then, inside the plant itself, we’ve upgraded, done things to the boilers and the grates, and we’re continuing to do that. So, we’ve invested about $5 million more than we thought we would during the first four years. But now we’ve made the big investments, unless something drastic would go wrong.

TheBurg: What does your future hold?

Warner: Getting back to here [the Harrisburg facility]—I could not be more pleased. This was not easy. This challenged our staff. Our board took a leap of faith with me driving this. I think it’s proved out.

The first four years, I think, will be the hardest. That’s when we had to do the most overhaul, prove ourselves in the community. People drive in here and drive out in 12 minutes. They use to have to wait in line for an hour and a half. So, the customer service has increased. We’ve taken this facility, which was substandard, and we’ve taken it—and I knew we could do this—we’ve put it to our standard, LCSWMA’s standard—and our standards are the best in the industry. So, we had a long way to go there. I think we’ve done well. The mayor, I think, is pretty pleased. I know that Public Works loves the service they get here. We don’t have any griping. When you get no griping, you know you’re doing things right.

With me—our board, my departure has been well planned. For years, I’ve been working with the board with timing. I think the board has made a wise move to promote from within, just like they took a little chance with me. They hired our current chief operating officer, Bob Zorbaugh. It’s his group that runs this and makes it function. We have an extremely strong executive team of six that Bob’s coming out of. He knows the business inside and out. It will take some time for people to get to know Bob, but he’ll do an excellent job. He knows what it is to make facilities function successfully.

To learn more about the Lancaster County Solid Waste Management Authority, visit www.lcswma.org.

Burg Blog: The Price of Protection

April 6, 2017 | by Lawrance Binda

The scene from a horrific fire last night on the 300-block of Maclay Street in Harrisburg.

Last night, shortly after 10 p.m., sirens began to wail in my neighborhood, getting nearer to my house until they seemed to be almost on top of it.

In Harrisburg, this sound is not unusual, but these sirens seemed to combine into a single force, coming at me from all directions. And as the volume increased, so did my concern.

I looked out my back window and could see a plume of smoke rising, maybe a block or two away. I put on shoes, grabbed a jacket and hurried out the door.

The fire was actually three blocks away, with two houses already engulfed, a wall of flame at their backs, and, in front, a stiff wind drove embers and acrid smoke across Maclay Street. I took some video, posted it to Twitter, then took in the scene around me: the onlookers, the neighborhood kids who had gathered, the trucks and hoses up and down the street, the many blinking lights. I was impressed, as I always am, by the precision work and professionalism of Chief Enterline’s men, who bravely beat back the flames, saving the entire block from certain incineration.

As I stood there, several other thoughts ran through my head: the safety of the people who lived in these rowhouses, what caused the fire, what the block would look like afterwards, if the houses were owned by “investors” and if they were up to code.

I also thought of a story that had broken several hours earlier—that the state legislature is trying to eliminate “Capitol fire protection” funding from the 2017-18 state budget. This is the money—$5 million in recent years—provided to Harrisburg to protect the Capitol complex’s 40 buildings, a sort of payment in lieu of taxes since the state pays no property tax on its massive holdings in the city.

This payment has been something of a political football over the years. Under former Mayor Steve Reed, it ranged from nothing to a few hundred thousand dollars a year. Former city receiver William Lynch and his people tried to standardize the compensation, arriving at the $5 million figure as a fair price for a year’s fire protection and, let’s be honest, a host of other services the city provides.

Several years ago, when Harrisburg’s financial recovery agreement was hammered out, I was surprised that this payment was not an explicit part of the deal, duly inked and signed. I asked Lynch about it, and he said that he had received assurances from the state that it would continue. I thought it was misplaced hope, and, as it turns out, it didn’t take long for state legislators to renege on whatever gentleman’s agreement Lynch thought he had.

Without a signed deal, this problem was inevitable. For Republicans, the fire protection payment is an easy cut to make, since it doesn’t affect their constituents, and they can even boast back home that they stuck it to Harrisburg (even if, in a weird meta, “Harrisburg,” to their constituents, doesn’t really refer to the city but to the loathed politicians that they themselves elect and send here).

And maybe the payment became even more precarious after the city, denied a commuter tax by the legislature, upped both the earned income tax and the local services tax. However, these taxes shouldn’t be conflated. Workers, not the state itself, pay the LST and EIT. The fire protection payment is really a substitute for a property tax, helping to fund the city’s Fire Bureau (and other vital services) so that the state can safely and confidently go about its business each and every day, including within the priceless Capitol building. That’s no small matter, and it’s not cheap.

In any case, Harrisburg’s representatives are now in the terrible position of having to re-secure that money every year, using every mode of influence they have. And the city is in the terrible position of not knowing if it will receive those funds, which threatens both its fiscal sustainability and its ability to provide high-quality emergency services.

Meanwhile, it’s not like Harrisburg is living large. This money is going to the most basic of services, ensuring that, when that terrible day comes (and it will) that a fire breaks out in a state-owned building, the Harrisburg Fire Bureau will be there, on site, within minutes, with the resources to do its job. Without those state funds, Harrisburg will have to lay off firefighters, Mayor Eric Papenfuse said.

Last night, I watched the fire on Maclay Street with a number of my neighbors, some from Midtown and some from Uptown. One woman cried as she spoke on her phone, describing the horrifying scene to a friend. She later told me that she lived in a house at the end of the row that was on fire.

I thought it was unfortunate that powerful people—members of the state legislature—weren’t also there to witness this tragedy. Then maybe fire protection wouldn’t be some abstraction or a number on a budget spreadsheet that can just get crossed out. They could see for themselves how high the stakes are—what is really at risk—and witness the heroic, critical work of Harrisburg’s firefighters.

Author: Lawrance Binda

A Year of Change: In 2014, you had to sift through the pastors, treasurers and gun-packing lawmakers to get to the most important news.

December 30, 2014 | by Lawrance Binda

At TheBurg, we’re not much into new media stuff.

Link bait, user-generated content, seeding. Yuck.

In recent months, I’ve had several news people defend aggregation to me, the practice of taking content produced by others and liberally repurposing it for one’s own use.

“We used to call that plagiarism,” I’ve snapped back, stunned that reporters are now being told to do things that used to get them fired.

Then there’s the listicle.

Using lists to convey information has been around for a long time.

For years, one of my favorite features in the Washington Post was the annual “What’s Out and In” list that appeared every New Year’s Day. I had no idea how the contributors determined what would be hot or not over the coming year (why, a few years back, were “cancer memoirs” out and “grief memoirs” in? Beats me), but I relished sitting down with a big cup of coffee and poring over the lengthy, whimsical list every Jan. 1.

In part, I enjoyed the feature because of its novelty. Presenting information as a list was an exception, not the rule, or a crutch, as it’s become for many media outlets today.

For the past few years, I’ve created my own list each January: the Top 10 Harrisburg news stories of the past year.

So, enjoy the list for what it is: a highly subjective summation and ranking, with my own spin on the year’s news. Feel free to nod, argue or curse me out. And I promise not to make a habit of it. This will be my one and only listicle of 2015.

10. Civil War War: Sometimes, big stories seem to pop up from nowhere, and the scuffle over funding for the Civil War Museum fit into that category. Without notice, Harrisburg Mayor Eric Papenfuse appeared at a Dauphin County commissioners session to mount a case for negating an agreement that set aside about $300,000 a year in hotel tax money for the museum. Over the ensuing months, the city and county revived issues that hadn’t been discussed much in years: the purpose of the museum, its viability, its funding and how Harrisburg should use its limited funds to market itself. It also re-engaged the always-simmering battle over the legacy of former Mayor Stephen Reed.

9. Pastor Arrested: Upon taking office, Papenfuse declared an all-out war on blight, targeting slumlords, deploying codes officers and even formulating a new Housing Court. That sounded fine to most people until the first person arrested under the get-tough policy was one of the city’s most prominent pastors, Bishop A.E. Sullivan, Jr., whose blighted church began to crumble down on its neighbors. For some, the arrest was an early test of Papenfuse’s resolve. For others, it signaled the re-emergence of racial tensions that always seem to lie just beneath the surface in Harrisburg.

8. Grand Jury Convened: What happens when you open a closet and a room full of secrets pours out? In the case of Harrisburg, a grand jury is empaneled. At press time, months after official-looking guys in official-looking jackets hauled away box-loads of potential evidence to Pittsburgh, the investigation continued into the myriad twisted, dubious deals that led to Harrisburg’s financial collapse.

7. Primetime Crime: If it bleeds, it leads, right? The media continued to have a field day (or year—or years) over the issue of crime in Harrisburg. Not that there wasn’t ample material to draw from. A continuing high homicide rate largely negated the good news that some other types of crime fell. Meanwhile, a few high-profile stories (the tragic case of Jared Tutko, Jr., a brief exchange of gunfire between a state legislator and a teenage mugger) led to predictable bouts of media hysteria. We’ll have to see if a few more cops and, as has been proposed, the revival of the school resource officer program make any difference for 2015.

6. Treasurer Trouble: Sometimes, it seems like Harrisburg just can’t catch a break. In August, trouble arose from an unexpected corner when city Treasurer John Campbell—a young man with a seemingly boundless future—was arrested on charges of taking money from several organizations where he also served as treasurer. These allegations involved no city business, and the treasurer’s office operates largely independently from the administration. Nonetheless, Campbell’s arrest was yet another reason for people to dump on Harrisburg, as was the withdrawal, two months later, of his appointed successor, Timothy East, after a personal bankruptcy came to light.

5. Receivership Ends: It came in with a bang and ended with a whimper. No, I’m not talking about the month of March, but about Harrisburg’s state-imposed receivership. In November 2011, bond attorney David Unkovic rode into the office amid tremendous skepticism over his intentions. In just a few months, he allayed those worries so that, when he suddenly resigned, many people feared the city had lost its best friend. In stormed Air Force Maj. Gen. William Lynch, who completed what Unkovic had started: selling the incinerator, privatizing the parking system and trying to straighten out and normalize Harrisburg’s calamitous finances. Count me among the surprised that the receivership ended so quickly after the major elements of the financial recovery plan were put into place. Today, the state retains some supervision over city finances as Harrisburg remains in Act 47. However, the receivership was never as strong-armed as many thought it would be, and, instead of fading away, it just went away.

4. Parking, Parking and More Parking: Besides crime, parking became the media’s go-to story of the year. Sleepy news day? Go find some suburbanites and restaurateurs pissed off about the rising cost of parking. Beneath the hype, there was a real story. As part of the city’s financial recovery agreement, parking rates doubled and metered parking expanded, which did negatively impact some businesses. In addition, the rollout of the new digital meters was bumpy, and Standard Parking was (how shall I put this?) god-awful in communicating with the public. But, by the end of the year, people seemed to be adjusting, and the new regimen even had some pluses, such as a new source of revenue for the city, the ability to use credit cards and much higher turnover of street spaces. Also, while some weak businesses shut down (though not all due to parking, believe it or not), several others opened.

3. Front Street Makeover: Sometimes, events are deemed important because they follow an accepted standard of what constitutes news—a political scandal or a high-profile crime, for instance. Other times, the importance is less certain, and only later do people realize the significance of a piece of news. I put the state’s announcement that, starting this spring, it will reconstruct Front Street, into the second category. Moreover, the state is studying improvements to Forster Street and to making much of N. 2^nd Street two-way. It also plans to re-open the dormant rail bridge to pedestrians and maybe transit. In other words, the state seems to want to reverse the damage wrought almost six decades ago, when much of Harrisburg was turned into either a freeway or a traffic island, with devastating results. A more welcome, livable city could be a game-changer for Harrisburg.

2. Papenfuse Takes Over: In January 2014, Eric Papenfuse took the oath of office as mayor of Harrisburg. In so doing, he promised to be both an effective administrator and an inspirational leader. A year later, I’m not sure about “inspirational,” but he has shown competence both in identifying what needs to be done and then taking steps to get those things done. From finances to blight to streetlights to schools, Papenfuse took on a full plate of issues, most very difficult, many controversial. My fellow columnist, Tara Leo Auchey, has described Harrisburg as being in a state of “reconstruction” following decades of misrule. The administration’s first year has been to try to stabilize a government in shambles and then plant the seeds of that reconstruction.

1. Balanced Budget: This may seem like an odd choice for the #1 news story in Harrisburg. Yawn, right? Yes, in most cities, a balanced budget indeed would be a non-event. In Harrisburg, however, this was (or should have been) major news, as it was the city’s first truly balanced budget in—God knows—20, 30 years? Papenfuse even insisted on including items that had been kept off-budget for decades, as Reed was a genius at tucking inconvenient expenses into places where they couldn’t be found, then masking the overage with borrowing. This is an achievement that should not be understated. Going forward, it should allow the city to build an honest foundation and move forward from there.

So, there you have it—my Top 10 stories of 2014. Looking at the year in whole, I consider 2014 to have been a transition year: a transition from state to local control; a transition from perpetual crisis to some level of normalcy; and, I hope, a transition from dishonest and incompetent government to one that conscientiously serves the people of Harrisburg.

Lawrance Binda is editor-in-chief of TheBurg.

April News Digest

April 29, 2014 | by Lawrance Binda

Grand Jury Probes City Finances

A state grand jury has been empaneled to investigate the various dealings that led to Harrisburg’s financial crisis.

Mayor Eric Papenfuse last month confirmed that he recently testified before the grand jury, which reportedly is meeting in Pittsburgh. He would not give specifics of his testimony.

City officials and former receivers William Lynch and David Unkovic all have supported criminal investigations into how the city wound up on the verge of bankruptcy, largely due to crippling debt tied to the city incinerator.

Dauphin County District Attorney Ed Marsico turned the matter over to state Attorney General Kathleen Kane after citing a possible conflict of interest in the case.

The grand jury probe appears to be wide-ranging. Investigators have taken large quantities of documents both from City Hall and the school district, according to sources.

In City Hall, many of the documents were discovered in locked filing cabinets and in locked closets that were opened once Papenfuse took office in January, sources said.

After its investigation is complete, the grand jury will recommend whether to file charges in the case. The prosecutor then determines whether or not to issue indictments.

Councilwoman Eugenia Smith Dies

Councilwoman Eugenia Smith died suddenly last month at age 53.

Smith, a lifelong city resident, died at Harrisburg Hospital after suffering a heart attack. She had begun her second term on City Council in January and was chair of the council’s Public Safety Committee.

“This is deeply shocking,” said Mayor Eric Papenfuse. “I share the pain and loss that people throughout our city assuredly feel as we try to absorb this sudden news. Our thoughts and prayers are with her family at this time.”

Council now must fill the open seat. City residents have until May 2 to submit applications, and a brief, public interview will follow. After nominations by council members, a final vote is slated for May 12. The new council member will serve until January 2016.

Judith Hill, Harrisburg’s first African-American councilwoman, also died last month.

Firefighter Contract Approved

Harrisburg City Council last month approved an agreement with the firefighter’s union designed to save the city about $70,000 a month.

The contract sets up a 14/1 shift, meaning that 14 firefighters and one commander will be on duty across the city at all times. Previously, the department operated with 16 firefighters and one commander for each shift.

The contract changes should significantly reduce firefighter overtime, a key element in city and state efforts to bring Harrisburg’s budget into balance.

The city last month also proposed closing the aging Paxton Fire Co. station in Shipoke. This proposal, an outgrowth of the new contract, caused concern among some residents, leading the Papenfuse administration to hold a community meeting to explain its plan.

Former Mayor Linda Thompson also had proposed closing the station, but dropped the idea after encountering resistance.

Mayor Moves to Replace Veno

Mayor Eric Papenfuse has asked the state to replace Gene Veno as chief recovery officer for the school district.

Papenfuse last month said he met with state Secretary of Education Carolyn Dumaresq to “express his alarm at the lack of progress at improving academic standards” in city schools and request that Veno be replaced.

“My concern is that Mr. Veno does not believe Harrisburg schools will meet academic benchmarks under the plan he devised,” he said. “This is unacceptable and compromises the future of our children.”

Papenfuse also came out in support of Key Charter School, which wishes to locate in the old Bishop McDevitt High School at 2200 Market St. The school board, which has rejected many charter school applications in recent years, must approve Key’s application.

“There should be a sense of urgency about these under-performing schools,” Papenfuse said, “and parents ought to have other possibilities to ensure their children are well educated and ready for the workplace. Harrisburg’s economic recovery won’t succeed unless we have an educated workforce ready to claim the jobs that will be created.”

“Mary K” Mansions Sell

A decade-long saga came to a close last month as the “Mary K mansions” sold at auction for a total of $756,000 to two buyers from the west shore.

On a sunny, cool day, multiple bidders dueled for about 2 1/2 hours at the outdoor auction, held on one of the four lots near the corner of Front and Manor streets.

In the end, Mike and Sally Wilson of Lisburn paid $361,000 for two of the properties at 2909 and 2917 N. Front St. Rob Edwards of Dillsburg paid $395,000 for 2901 N. Front St., which includes a large house and a parking lot off of Division Street.

Mike Wilson, the owner of Integral Construction, said that he and his wife intend to renovate and live in the mansion at 2909 N. Front, but he wasn’t sure what they’d do with 2917 N. Front, a dilapidated building that long served as an office building.

Edwards said he had no plans yet for his properties. He said he often buys and sells properties at auction and was attracted to these houses because of the location on the river.

Previous owner Mary Knackstedt bought the properties in 2004, planning to raze them and build a 32-unit condominium development. However, her land use plan met fierce resistance in the neighborhood, and City Council ultimately rejected it.

She later defaulted on her mortgages and declared bankruptcy. A last-ditch effort last year to sell the properties for $2.5 million failed, leading to the auction.

Illegal Gun Project Launched

Harrisburg and Dauphin County are teaming up to increase penalties for carrying illegal weapons.

Under the “$100K Illegal Gun Project,” Harrisburg police officers and the county district attorney’s office will request that courts set bail at a minimum of $100,000 for anyone charged with illegally carrying a firearm.

The bail amount would be recommended for felons who are prohibited from carrying a gun and for anyone carrying one on themselves or in their vehicle without a license, according to a joint city/county announcement.

In addition, police and prosecutors will request juvenile detention for any juvenile older than 15 who is charged with illegally carrying a firearm.

Historic Train Moved

The historic GG1 Pennsylvania railroad locomotive No. 4859 was temporarily moved from its spot at the Harrisburg Transportation Center last month to a siding 1,000 feet west of the station.

Rail enthusiasts gathered to watch and take photos of the GGI locomotive and caboose, which were moved so that Amtrak could continue its $36 million project to improve power, signals, track and switches in the station.

An Amtrak locomotive pushed the GGI and caboose to a siding near the 7^th Street garage about ¼-mile away. The locomotive then was “shrink-wrapped” to protect it from the elements until it can be moved back to its current location.

The GG1 served the Harrisburg station on service to Philadelphia and New York between 1938 and 1981. It was located at the station as a memorial to that service in 1986, designated as the official state locomotive and is listed on the National Register of Historic Places.

The Harrisburg Chapter of the National Railway Historical Society maintains both No. 4859 and the caboose.

Changing Hands

Calder St., 211: T. Chapin to I. Blynn, $165,000

Charles St., 232: L. Milner & A. Lee to R. Gosnell, $120,000

Chestnut St., 2048: Secretary of Housing & Urban Development et al to S. Reyes, $70,875

Disbrow St., 97: J. Handy Jr. to J. Hobbs, $45,000

Duke St., 2452: PA Deals LLC to M. & D. Graeff, $68,000

Harris St., 230: Fannie Mae to Klimke Holdings LLC, $51,000

Jefferson St., 2241: Kirsch & Burns LLC to LMK Properties LLC, $45,000

Manada St., 1918: K. & J. Frobenius to 2013 Central PA Real Estate LLC, $55,000

Market St., 1827: K. Frobenius et al to 2013 Central PA Real Estate Fund LLC, $55,000

North St., 231, 233, 235: F. Galiardo Realty Management Associates LLC to Murphy & Laus Real Estate LLC, $325,000

N. 2^nd St., 817: R. Baker to HCH Investments LP, $127,000

N. 3^rd St., 1633: B. Jones & C. Heintzelman to J. & S. Compton, $38,000

N. 4^th St., 2737: M. Horgan & Innovative Devices Inc. to T. Murphy, $37,000

N. 5^th St., 3024: S. Zerbe to J. Olan, $89,000

N. 6^th St., 2013: Sixth Street Clover Club to Victor Ventures, $30,000

N. 16^th St., 921: J. & V. Waid to Equity Trust Co., $38,250

N. Front St., 1107: J. Farrell to M. Perrone, $184,900

Parkway Blvd., 2507: R. Zogby & L. Sfier to B. & B. Reid, $120,000

Peffer St., 214: BFI LP to M. Magaro et al, $51,000

Penn St., 1424: R. Benton to R. Essig, $30,000

Penn St., 2315: BFI LP to M. Magaro et al, $36,000

Regina St., 1849: J. Vogelsong to D. Moore Sr., $40,000

Rolleston St., 1315 & 1411: S & R Estates LLC to Keystone RH LLC, $890,000

Rudy Rd., 2400: Secretary of Housing & Urban Development to J. & M. Caulfield, $90,000

S. 14^th St., 361: J. Rodriguez to Urena Diaz Property, $33,000

S. 15^th St., 438: J. Vogelsong to D. Moore Sr., $30,000

S. 16^th St., 336: Harrisburg Redevelopment Authority & Tri-County HDC to L. Wilson, $101,000

S. 20^th St., 1226: G. & H. Fabiankovitz to R. & G. MacWhinnie, $110,000

S. 25^th St., 713: Fannie Mae to S. Mosley, $50,500

S. 26^th St., 710: Fannie Mae to S. Mirenda, $62,500

S. 27^th St., 724: E. & R. Kolp to S. Armstrong & P. Hudson, $125,000

Walnut St., 1261: JP Morgan Chase Bank NA to G & G Property Services LLC, $35,000

Bit of Change: Harrisburg’s new parking regimen has hit an unexpected snag, but an innovative solution may be at hand.

March 31, 2014 | by Lawrance Binda and Paul Barker

Terry Sweeney stopped coming to downtown Harrisburg last month, even though several of the restaurants on 2^nd Street are among his favorites.

He felt he had no choice. The increased cost of parking was putting a huge dent in his monthly budget.

“I simply can’t afford the parking or the tickets,” said the Mechanicsburg resident. “I’m not sure anyone can.”

Sweeney was more accurate in his assessment than he may have realized.

Parking operator Standard Parking last month said its internal studies revealed that there is not enough dollar-denominated currency in circulation in the greater Harrisburg area to pay for the new parking rates.

So, according to spokesman Rob Porter, it’s begun to retrofit its new meters to accept bitcoins, the digital currency that some regard as a legitimate form of money.

“We took a closer look at our budget for 2014 and realized that, in fact, the citizens of Harrisburg do not actually have sufficient American currency—or really sovereign currency of any kind—to meet our revenue projections,” Porter said. “And one way to close that gap is for residents to tap into the shadowy, unregulated underworld of a Japanese software eccentric’s technological fantasy.”

Software developer Satoshi Nakamoto created bitcoin just five years ago as an alternative to traditional, country-sanctioned forms of money. Bitcoins are not controlled by nations or central banks, but use computers on a network to confirm bitcoin transactions and mint new currency.

Mayor Eric Papenfuse said that he “warmly welcomes” the prospect of bitcoin-compatible parking meters.

“It’s just so exciting,” he said. “It’s a terrific example of exactly the kind of public/private/shadow economy partnership that I’ve been touting all along. Once again, Harrisburg is on the cutting edge of creative financing.”

Papenfuse then went on to list all the “really neat things” the city would be able to buy when Harrisburg receives its share of bitcoin revenue: sushi from a restaurant in Palo Alto, Calif.; a college degree from the University of Cyprus; black market cigarettes; the ability to wager in online casinos.

Other city officials were taking a more cautious approach to the development.

“The founding fathers and Ronald Reagan didn’t need any bitcoin,” said Councilwoman Sandra Reid. “I say this to un-American bitcoin: Four score and seven years ago!”

Reid added that, following several neighborhood hearings, she would urge the city to reconsider its embrace of the virtual currency. When reminded that the city no longer owns or controls the parking system, she responded, “When did this happen? Why wasn’t I consulted?”

Council President Wanda Williams said she was still studying the issue, but would read an hour-long, prepared statement defending her position once she makes up her mind.

Indeed, bitcoin has become increasingly controversial since it began to be embraced last year, mostly by day traders, tech geeks and people who believe that modern civilization is a fiction whose time of reckoning is at hand.

One problem is the potential that the currency will collapse altogether, a possibility heightened by events like February’s theft of $477 million in bitcoins from Mt. Gox, a virtual currency giant, by online hackers.

If that happens, said spokesman Porter, Standard Parking may have to fall back on its “Plan B”: accepting the city’s physical assets as a form of substitute payment.

“We’ll take anything, really,” Porter said. “Civil war museums, minor league ballparks, state Capitol buildings, parking systems. Oh right, we already got that last one.”

He said, in a pinch, he’d even accept private houses.

“We’d generously lease them back to the old owners,” he said, “as long as their tribute—I mean rent—is paid in bitcoins.”

“Anything except sewer pipes,” he added. “You can keep those.”

The potential downside, however, does not concern former city receiver William Lynch, who said he approves of what he called bitcoin’s “essential characteristic”: the fact that no one really understands what it is or how it works.

“That same characteristic was the key to the whole receivership and the recovery plan,” said Lynch, who then winked, boarded a helicopter and flew away up the Susquehanna.

Upon further reporting, TheBurg has learned that nothing in this story actually happened, was said by the individuals quoted or paraphrased or is otherwise accurate. Happy April Fools, Harrisburg! (with inspirational credit to #ScotchinTheBurg)

Receivership in Rearview: Why did it turn out so differently than expected?

February 28, 2014 | by Lawrance Binda

Screenshot 2014-02-28 08.34.09 In December 2011, just as Harrisburg was beginning life under a state-appointed receiver, I wrote the following:

“Harrisburg is about to enter a new period, a time it’s never before experienced. The state takeover is unlike the city’s previous downs. In this down, Harrisburg is almost completely at the mercy of outsiders, who, most certainly, will not have the interest of the people who live here as a first priority.”

In other writings, I described receivership as an attempt to force the thrice-rejected Act 47 plan down the city’s throat, which would lead to a fire sale of city assets so creditors complicit in its financial crisis would be paid in full.

And so it seemed.

The receivership legislation appeared designed to punish Harrisburg more than help it, to ensure that creditors would get all their money, to protect suburban commuters, to stick it to defiant members of City Council.

Why else would bankruptcy be banned, would a commuter tax be forbidden, would a regional sales tax be off the table? What else could explain the ridiculous timeframe that gave the receiver just 30 days to draft a recovery plan, with the expectation that he’d have six months to implement it? Clearly, the fix was in.

Fast-forward two years.

In late January, the state announced that it expected the receivership to end on March 1, which caused me to think back on my initial impressions, thoughts and writings. For the most part, I think my analysis at the time was correct. The enabling legislation, SB1151, was intended to force city residents to bear this burden. Why, then, did the receivership turn out so differently?

Last month, our columnist, Tara Leo Auchey, credited the people of Harrisburg for influencing and inspiring the first receiver, David Unkovic, who, moved by their plight, drafted a recovery plan that treated residents as fairly as possible.

Indeed, Unkovic repeatedly made himself available to the public and, during his short but critical tenure, seemed far more concerned with the predicament of residents than I ever would have imagined on that cold day in November 2011, when, with great skepticism, I watched him being introduced at a press conference in the state Capitol.

At his core, however, Unkovic is a finance guy, a bond attorney. While he showed remarkable cause with the people of Harrisburg, he showed even more outrage over how his passion, the thing he had dedicated his life to—municipal finance—had been perverted by the Reed administration and its many enablers.

“It stunk like a kettle of rotten fish,” Unkovic said of the incinerator financings in testimony before a state Senate committee hearing. “This is the worst set of financings I’ve ever seen.”

Once he unraveled the nonsense behind the incinerator, the museum artifacts, the deceptive city budgets, Unkovic felt compelled to right the situation as best he could. Yes, Harrisburg had to pay down its debt by shedding some valuable assets, but that, he believed, could be done in a fiscally responsible way that also didn’t punish the people, who largely had been left in the dark during the Reed years and then left holding the bag.

In late March 2012, Unkovic resigned abruptly, citing unyielding pressure from creditors unhappy with his focus on fairness. That turn of events had an “Empire Strikes Back” quality to it, and many residents, myself included, again feared that the state would enforce the payback of creditors with little concern for the consequences to the city.

But that didn’t happen either.

The new receiver, Air Force Maj. Gen. William Lynch, couldn’t have been more different from Unkovic. He had no municipal finance experience, did not readily engage the public and had a direct, taciturn style. However, he sustained the focus on fairness, and his final recovery plan boldly built upon his predecessor’s already-creative approach to solving Harrisburg’s financial crisis.

Just as importantly, the receiver’s main consultants and advisers were finance people, ones who shared Unkovic’s affront over the financial games that had buried this city in debt. So, an impressive, experienced team of professionals bridged the two tenures, despite turmoil at the top.

I’ve written previously that I believe the receivership is ending too quickly, that it would have been better to wind it down over the course of this year. I continue to think this. However, I am glad that Harrisburg’s experience with state intervention ended up so much better than I had expected and, I believe, very differently than its architects had envisioned.

With the backing of Gov. Tom Corbett, Unkovic, Lynch and their “geniuses” (as Lynch liked to call his main staffers) crafted a plan that tried to do right by the city, its residents and the principles of good municipal finance, while completing their assigned job of settling Harrisburg’s mind-blowing debt.

As we wave good-bye to the receiver, I am thankful that Harrisburg has a chance to build a brighter future, something unimaginable until recently. And, looking back at the language of SB1151, I’m also thankful that the law of unintended consequences finally seemed to favor this long-luckless city.

Lawrance Binda is editor-in-chief of TheBurg.

Inspired by the People: No longer docile, Harrisburg’s residents helped guide the financial recovery plan.

January 31, 2014 | by Tara Leo Auchey

David Unkovic, former receiver of the City of Harrisburg.

“I think part of why Harrisburg has succeeded to this point is because of the people who live there.”

So said David Unkovic, former receiver of the City of Harrisburg, during a talk to McNees, Wallace & Nurick law firm colleagues, various elected officials, and other interested persons who gathered in a room last month at the Hamilton Club in Lancaster to hear him give a presentation entitled “Harrisburg: A National Model for Addressing Municipal Distress.”

He called the story of Harrisburg remarkable. He said the sequence of events of Harrisburg’s debt crisis were serendipitously just right despite the strife, fight and controversy that encompassed the saga.

In fact, he believes all of that was perfectly part of what happened.

As someone who closely watched and engaged with the unfolding events over the past five years—and studied the story much farther back—I agree. The strife reflected the complexity of the situation.

The fight pushed for substantive solutions.

The controversy attracted attention.

Without all of it, Pennsylvania’s capital city would be much worse off.

Now, not everyone concurs, and Unkovic acknowledged that.

He spoke of the contingent who believe the city should have been permitted to file for Chapter 9 bankruptcy, convinced that was the only correct answer to solve Harrisburg’s incredible fiscal crisis. “There are some people who think the city would have been better off in bankruptcy, but I don’t think that’s true.”

Aside from the cost and the unfortunate stigma, he pointed to the certainty that nothing is guaranteed in bankruptcy. “Everything is tested in the court,” he said.

However, such a position is not acceptable to those who think the city’s current path to recovery is bogus. Some citizens feel the so-called Harrisburg Strong Plan is the wrong plan for the city’s betterment, designed for the creditors and not for the people.

Unkovic sees it differently. “The plan for Harrisburg really got it right.”

What he didn’t say outright is that the plan only works if the citizens make it work. It’s all about the citizens. But, of course, he did say Harrisburg has some pretty special citizens.

For far too long, the citizens of Harrisburg were encouraged to disengage. Okay, so this may not have been the exact message that leaders splayed on flyers, declared in public service announcements or proclaimed in the media, but, all the same, the sentiment was loud and clear. For 28 years, Mayor Stephen Reed took care of things. He didn’t require citizens to give input or involve themselves in the business he conducted on behalf of the city. He didn’t need them to ask questions or offer suggestions. He merely needed them to listen to the pontifications he famously expounded.

Then came Linda Thompson. She modeled the reign that she observed for years, the reign she pined for and seized. When she became mayor, she adopted the attitude of power that separated her from the citizens. Rather than partner with people and their attempts to contribute, she had a tendency to appropriate projects and call them her own, cutting out the credit where credit was due.

Receivership changed all of that. Just as the state usurped the authority of the city, so could the citizens. For the first time in decades, the people of Harrisburg had the capacity to be heard and effective. And the strife, fight and controversy helped the cause along.

Our jobs have only begun, though.

Last month, the state filed a motion to end Harrisburg’s receivership. It is deemed no longer necessary. The plan is accepted, the debt is paid off, and, theoretically, the potential for stability has been set in place.

With the receiver soon to be gone, the onus is now on the citizens to make the city’s success happen. It is up to the citizens to engage, participate in the plan’s implementation, sit on boards, offer counsel and hold leaders accountable.

Sure, there are people frustrated, people still apathetic, and people not happy with how the events unfolded. Yet, it’s difficult to dispute that the citizens didn’t have an influence.

Unkovic said it was the citizens who impressed him the most during his time in Harrisburg. What he didn’t say—or really need to—is that it was the citizens who inspired him to do what he did for Harrisburg.

It hasn’t been an easy road for anyone involved, nor does it look like the challenges will disappear anytime soon. The virtue, though, is that we’ve gotten this far.

It’s not a bad place to be, and the next steps are essentially ours to take.

That means the future is filled with possibility and promise because, after all, the citizens of Harrisburg are pretty remarkable.

Tara Leo Auchey is creator and editor of today’s the day Harrisburg. www.todaysthedayhbg.

January News Digest

January 30, 2014 | by Lawrance Binda

Harrisburg Receivership to End

The state last month submitted a petition to end Harrisburg’s 26-month-old receivership, stating that “critical components” of the city’s financial recovery plan had been completed.

If the petition is approved by the Commonwealth Court, the receivership would conclude on March 1, concurrent with the end of the state-declared “fiscal emergency” for the city. At that time, an Act 47 coordinator would replace the receiver to oversee and help guide implementation of the rest of the Harrisburg Strong Plan.

Just last November, the receiver’s term was extended for two years.

“The receiver is no longer vital and necessary to successful implementation of the remaining components of the Harrisburg Strong Plan in the absence of a fiscal emergency, and the remaining components of the plan can be successfully implemented by a coordinator appointed by the secretary (of DCED),” according to the petition by C. Alan Walker, secretary of the state Department of Community and Economic Development.

While most of the plan has been implemented—including the sale of the incinerator and the long-term lease of the city’s parking assets—a few parts remain unresolved, such as a new labor agreement with the city’s firefighters’ union.

The state imposed receivership on Harrisburg in November 2011 after the squabbling city government could not reach an agreement to resolve its financial crisis. Bond lawyer David Unkovic served several months in the post, drafting the initial recovery plan.

After Unkovic resigned, Air Force Maj. Gen. William Lynch took over as receiver, overseeing the creation of the final recovery plan and its implementation to date.

Officials Sworn In

The leadership of Harrisburg’s municipal government changed dramatically last month as several recently elected officials took the oath of office.

Eric Papenfuse became the city’s 38^th mayor at a brief swearing-in ceremony in City Hall, replacing one-term Mayor Linda Thompson in the office.

At the same event, Charles DeBrunner took the oath as the new city controller, and Ben Allatt and Shamaine Daniels were sworn in as new council members. Returning Councilwomen Wanda Williams and Eugenia Smith also began four-year terms.

Following the ceremony, City Council held its reorganization meeting. Williams was re-elected council president, while Sandra Reid became council vice-president.

In addition, council made committee assignments. The new committee chairs are:

Administration Committee: Wanda Williams
Budget and Finance Committee: Ben Allatt
Building and Housing Committee: Shamaine Daniels
Community and Economic Development Committee: Brad Koplinski
Parks, Recreation and Enrichment Committee: Susan Brown-Wilson
Public Safety Committee: Eugenia Smith
Public Works Committee: Sandra Reid

Each committee is made up of three council members except for the administration committee, which includes all council members.

Papenfuse Announces Cabinet

Mayor Eric Papenfuse last month announced his choices for most of the top administrative posts in city government. These include:

Neil Grover, who took over as city solicitor from Jason Hess. An attorney in private practice, Grover had served recently as special counsel to City Council.

Aaron Johnson, who replaced Kevin Hagerich as director of the Public Works Department. Johnson, previously the department’s deputy director, ran against Papenfuse as a write-in candidate for mayor in November, garnering about 17 percent of the total vote.

Bruce Weber, director of budget and finance, a post last held by long-time director Bob Kroboth. Weber formerly served on City Council.

Joyce Davis, a key Papenfuse advisor, as director of communications.

Jackie Z. Parker, a former mayor of Lebanon, as director of community and economic development.

Roy Christ, former president of the Harrisburg school board, as director of building and housing.

Lenwood Sloan as director of the newly named and reorganized Department of Arts, Culture and Tourism.

Carlesha Halkias, former deputy city solicitor, as director of human resources.

In addition, Karl Singleton was named as senior advisor on education and youth and Catherine Stetler as scheduler.

The Harrisburg Regional Chamber and Capital Region Economic Development Corp. (CREDC) will fund Parker’s position in full for the first year and at 50 percent for the second and third years. The city will take over full funding of the position in year four.

Budget Revisited

Harrisburg City Council last month reopened the 2014 budget to better reflect the spending priorities of the Papenfuse administration.

The $78.5 million budget is about $280,000 more than the budget passed in December, reflecting a slight increase in projected revenues from the earned income tax and intergovernmental transfers.

The greatest changes came on the spending side.

Mayor Eric Papenfuse proposed abolishing the post of chief operating officer, which paid $110,000 a year. Instead, he wants to establish the position of chief of staff/business administrator at an annual salary of $79,500. A new post of community services coordinator, paying $50,000 a year, would replace the position of assistant to the COO, which paid $41,000 annually.

Other proposed changes included:

Creation of several new posts, including director of arts, culture and tourism, director of sustainability and director of planning.
Raises for a number of management-level positions, including for the director of building and housing development, the director of financial management, the director of human resources, the police chief and the communications director.
Consolidating certain positions, decreasing salaries for others and not filling several vacant posts.

The council’s first budget review committee hearing is scheduled for Jan. 30. A final vote on the new budget is currently slated for Feb. 11.

Transition Report Released

The Papenfuse administration last month released a report with dozens of recommendations on how to improve government performance.

The 17-page report contained suggestions ranging from aggressively seeking grant money to making greater use of technology to tighter integration and communication between segments of government.

A few of the recommendations include:

Adequately staffing the finance unit by filling vacant positions and completing financial reporting on a timelier basis.
Appointing or designating an arts, culture, heritage and tourism liaison officer to oversee programs, activities and events.
Developing and implementing a plan for upgrading the city’s website, improving content and implementing social media.
Negotiating public/private partnerships to supplement resources.
Creating a new department focused on education, youth, recreation and related matters, hiring a qualified director and staff and securing new funding and partnerships.
Adopting a “broken windows” law enforcement approach to reduce crime and preserve order in targeted neighborhoods.
Conducting an independent feasibility assessment of alternative ways of providing sanitation service.

More than 70 people served on Mayor Eric Papenfuse’s transition teams and contributed to the report, which was compiled by consultant Robert Melville.

“This report represents hours of hard work from very dedicated people who want to see Harrisburg rise out of its problems and become the model capital it should be,” Papenfuse said.

The report contains many more ideas to improve the city government’s functions and operations. Read the entire report on TheBurg’s website, www.theburgnews.com, under the “News” category.

Brewery Eyes Midtown Building

If all goes right, a new brewery will debut in the heart of Midtown Harrisburg in the early fall.

Alter Ego Brewing Co. hopes to open a brewhouse in long-vacant space at the corner of Susquehanna and Boyd streets, at the rear of Midtown Cinema. The 3,500-square-foot brick building would house a beer-making operation, in addition to a tasting room with a limited menu featuring small plates, paninis and finger foods, said Brandalynn Armstrong, who operates Alter Ego with her husband, Theo.

The Armstrongs have numerous hurdles to overcome before they can open, including securing a liquor license and probable land use approvals. The building also requires a complete renovation, which should begin in late spring.

The couple took their first step late last month, holding a community meeting at Midtown Cinema, where they presented their plan and answered questions.

“We want to be good neighbors and an active member of the community,” said Brandalynn. “We think it’s a good fit for Harrisburg and that Harrisburg is a good fit for us.”

In addition to offering Alter Ego beers and a limited menu, the Armstrongs will feature local Pennsylvania wines and art gallery space. No liquor will be served.

The building is owned by Lift Development LLC, which includes two partners of GreenWorks Development. A couple of years ago, the state tried to relocate the former Midtown magisterial district justice’s office and courtroom to the building, but an agreement could not be reached.

More information on Alter Ego Brewing is at www.alteregobrewing.com.

Changing Hands

Berryhill St., 1940: PA Deals LLC to S. Maurer, $75,000

Briggs St., 1823: Wells Fargo Bank NA to S. Dial, $99,000

Brookwood St., 2420: P. White to M. Rodriguez, $63,900

Chestnut St., 2403: H. & L. Miller to L. & M. Walton, $149,000

Green St., 1703: Wells Fargo Bank NA & J. Landis to PA Deals LLC & J. Etzle, $116,500

Green St., 2013: WCI Partners LP to L. Binda, $209,000

Green St., 2135: D. Boyle to V. Brown, $35,000

Green St., 2233: R. Shokes Jr. & Shokes Enterprises LLC to R. & D. Requa, $60,000

Kelker St., 213: J. Henning to M. Porter, $124,500

Lewis St., 228: D. Hartman to C. Moss, $59,000

Manada St., 1903: PA Deals LLC to M. & D. Graeff, $90,000

N. 2^nd St., 606: D. Brown Jr. to 606 Dalmatian House LP, $754,000

N. 2^nd St., 1311: Susquehanna Bank to J. Feldman, $36,000

N. 2^nd St., 1313: Brick City Investments LLC to 1313 Real Estate Holdings LLC, $245,000

N. 2^nd St., 1522: T. & A. Magrory to J. Cantarell & A. Meck, $168,900

N. 2^nd St., 2731: Sierra Real Estate LLC to T. & N. Schmitt, $240,000

N. 6^th St., 2667: J. Vogelsong to G. Di Bosco, $31,500

N. 15^th St., 1603, 249 Maclay St., 438 Muench St. & 614 Wiconisco St.: R. Shokes Jr. & Shokes Enterprises to R. & D. Requa, $266,000

N. Cameron St., 1817: Integrity Bank to 1817 Cameron St. Associates LLC, $100,000

N. Front St., 1721: Susquehanna River Basin Commission to Hersha H. & Hasu P. Shah Family Foundation, $875,000

North St., 263: B. Josephs to B. Minner, $84,000

North St., 2009: J. & C. Mills to K. Snoke, $42,000

Paxton St., 1638: T. & A. Ferguson to CNC Realty Group Inc., $55,000

Penn St., 1612: J. & E. Rosentel to A. La Laz, $152,500

Penn St., 1703: Fannie Mae to B. Swisher Houtz, $63,000

S. 13^th St., 342: K. & S. Probst to B. & R. Lehman, $53,000

S. 13^th St., 502: PA Deals LLC to J. & A. Garbanzos, $45,000

S. 15^th St., 446 & 141 N. Cameron St.: G. Neff to San Pef Inc., $45,000

S. 17^th St., 325: R. Ekvall to J. Tran & D. Nguyen, $50,000

S. 18^th St., 1115: K. & W. Watson to M. Kaman & A. Phatimah, $68,000

S. 19^th St., 1670: The Harrisburg Authority to the Lancaster County Solid Waste Management Authority, $121,898,000

S. 28^th St., 806: DML Properties LP to AWK Consulting Engineers Inc., $225,000

Swatara St., 2025: Mussani & Co. to I. Fernandez, $65,000

Valley Rd., 2301A: F. & J. Haas to S. Thornsley, $195,000

Vine St., 114: F. Hutchinson to J. Robles, $135,000

Walnut St., 407: J. Brown & Graci LaPorta Partnership to J. & C. Bowen, $50,000

Harrisburg property sales for December 2013, greater than $30,000. Source Dauphin County. Data is assumed to be accurate.

Change of Plans

January 17, 2014 | by Lawrance Binda

That was fast.

Harrisburg Mayor Eric Papenfuse was sworn into office just 12 days ago, but already we’re witnessing a dismantling of the structure put into place by the state to guide the city to financial recovery and help ensure more professional governance.

On Tuesday, Papenfuse announced that he is asking City Council to defund the position of chief operating officer and, yesterday, the state petitioned the Commonwealth Court to eliminate the state-imposed receivership. Assuming these requests are granted, Harrisburg will be back organizationally to a strong mayor who controls most of the levers of city government.

Whether you judge this to be a welcome development depends upon two key factors.

First of all, do you believe that Harrisburg continues to need the strong hand of the receiver and the professional management (at least in theory) of a COO?

The state created the receivership to formulate and implement a financial recovery plan for the city, to force that solution on feuding parts of the city government and to fortify the Thompson administration with additional expertise and oversight.

Over the course of two-plus years, the receiver accomplished these goals, although a few elements of the Harrisburg Strong plan, notably a new labor agreement with the firefighters’ union, are unfinished. The city will remain under Act 47, which means that a coordinator appointed by the state Department of Community and Economic Development (DCED) will continue to have some influence over city operations.

As for the COO position, it was one of the key reforms of city government proposed by David Unkovic, the city’s first receiver, and, until recently, seemingly supported by the second, William Lynch. It was designed to professionalize how government operated on a daily basis, helping to ensure that the city was not again brought low by the political and personal agendas and limitations of its powerful mayors.

Many municipalities, in fact, are run daily by a professional city manager, and, under the reform, Harrisburg, though structured differently, would largely have followed that model.

On Tuesday, in his budget address to City Council, Papenfuse characterized the change more as a reclassification than an elimination. The COO, he said, would morph into the position of business administrator—with a $30,500 pay cut.

However, this is no reclassification. If defunded by City Council, the COO job is gone, and Harrisburg will revert to its strong-mayor form of government. The business administrator will serve as the mayor’s right-hand man (or woman), important but clearly beneath the mayor in the hierarchy. The huge pay cut emphasizes this point, with the business administrator’s salary tellingly just a whisker ($500 a year) below the mayor’s.

These changes are quite an achievement for Papenfuse, so early on in his administration. If both the receiver and the COO go away, he will have effectively re-consolidated the power of the office of the mayor. He also will have clarified the city’s hierarchy of authority, which has been muddied for more than two years, first by the creation of the receiver then by the addition of the COO.

Evidently, Lynch and others at DCED have enough confidence in Papenfuse that they no longer deem either office necessary. On Tuesday, Papenfuse told council that Lynch supports ending Harrisburg’s COO experiment, which, admittedly was no great success under two short-lived, if very well paid, administrators.

And that brings me to the second way of judging these developments.

Ultimately, how you view the re-creation of the powerful mayor’s office depends upon how you view Papenfuse. If you believe he can handle the office effectively and responsibly, you might be happy that he has consolidated power so quickly. If not, then you probably aren’t.

So far, I like what I’ve seen from the administration. Papenfuse’s appointments have been solid, and I support his decisions to work closely with council and to make government more accessible and friendly. His early moves have been pragmatic, not dogmatic or personal.

That said: it’s very early. I would be reluctant to reach any conclusions until at least six months have passed—and that’s why these recent moves give me pause.

I expected the receivership, which was extended just in November, to end well before its two-year term, but not just weeks into it. I expected the COO job to go unfilled for some time, until the administration got its bearings and the flow of government settled.

As a resident, I would have felt more comfortable had the receiver allowed more time, so that the new administration could settle in and show itself capable of governing well. As it stands, these changes appear rushed. I understand that the re-opening of the budget was viewed as an opportune time to make adjustments, but the resulting changes are huge. A more gradual evolution in the city’s power structure may have better served the still-wary, skeptical residents of this city.

Harrisburg Receivership to End

January 16, 2014 | by Lawrance Binda

The state today submitted a petition to end Harrisburg’s 26-month-old receivership, stating that “critical components” of the city’s financial recovery plan had been completed.

If approved by the Commonwealth Court, the receivership would conclude on March 1, concurrent with the end of the state-declared “fiscal emergency” for the city. At that time, an Act 47 coordinator would replace the receiver to oversee and help guide implementation of the rest of the Harrisburg Strong Plan.

Just last November, the receiver’s term was extended for two years.

The state imposed receivership on Harrisburg in November 2011 after the city could not reach an agreement to resolve its financial crisis. Bond lawyer David Unkovic served several months in the post, drafting the initial recovery plan.

After Unkovic resigned, Air Force Maj. Gen. William Lynch took over as receiver, overseeing the creation of the final recovery plan and its implementation to date.

Read the entire petition from Walker to Judge Bonnie Brigance Leadbetter: ReceivershipPetition.

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