Wednesday, October 12, 2011
Harrisburg, PA Files for Chapter 9 Bankruptcy
In a somewhat divisive move, the Harrisburg City Council voted 4-3 to file for Chapter 9 bankruptcy.
Harrisburg is the capital of Pennsylvania, and is currently attempting to file for Chapter 9 bankruptcy, the chapter specifically created for municipalities. Chapter 9 provides protection from creditors while the municipality reorganizes its debts.
Mayor Linda Thomson and the state are opposed to the bankruptcy filing, wishing instead to create and implement a fiscal rescue plan. The state is serious enough in its opposition to attempt to take control of Harrisburg. The state house has passed a bill that would allow the state to take control of Harrisburg and establish a fiscal rescue plan. Next week, the state senate will decide whether to pass the bill.
A primary reason that Harrisburg has become so indebted is the city’s trash incinerator facility, a project that cost almost $300 million. The incinerator has not brought in the revenue it was expected to.
Unfortunately, Harrisburg is one of many recent Chapter 9 bankruptcies. The city joins other municipalities including Central Falls, Rhode Island. Some economists and financial analysts are predicting that more will follow.
To learn more about bankruptcy, please contact an experienced bankruptcy attorney in your area.
posted by Tess @ 1:23 PM
0 Comments:
Post a Comment
<< Home