Gov. Ed Rendell made it clear Wednesday that the state isn’t going to bail Harrisburg out of its financial crisis.

Rendell met with Mayor Linda Thompson for about an hour in his office to discuss the city’s financial situation and possible solutions. Also included were Mike Casey, Thompson’s temporary business administrator, Nate Waters, who served on her education transition team, and James Ellison, chairman of the Harrisburg Authority.

“There’s no easy, pain-free way out,” Rendell said afterward.

Harrisburg is in financial turmoil after guaranteeing a large portion of the Harrisburg Authority’s $288 million debt on the incinerator. The authority has made few bond payments on that debt, leaving the city and Dauphin County to pick up the tab.

Rendell and Thompson said they want Harrisburg to hold off on asking the state to declare the city financially distressed under Pennsylvania’s Act 47.

Under the act, a municipality works with the state Department of Community and Economic Development to create a fiscal plan while state loans help maintain basic city services. The loans must be repaid.

Act 47 wouldn’t solve Harrisburg’s debt problem. Rendell said.

“If we could give Harrisburg a half a million dollars a year under Act 47, that would be a lot,” Rendell said. “So, there is no Santa Claus riding into the aid of the city.”

Rendell said it is up to the city to deliver itself from its financial situation, and he offered the city the help of former state Department of Banking Secretary Bill Schenck and Pennsylvania Housing Finance Agency executive director Brian Hudson.

Rendell said Thompson requested his help on the city’s finances when she was mayor-elect.

“We just went over the plan the mayor has developed,” Rendell said after Wednesday’s meeting. “From the state’s standpoint, I believe this plan is a workable one. “

That plan includes selling city assets and getting Dauphin County to increase the tipping fees it pays to the Harrisburg Authority, Rendell said. So far, the county has been unwilling to raise its trash fees. No representatives from the county were at the meeting.

The assets to be sold were not identified.

Read the full Patriot-News article here

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