Here is how you do it - Harrisburgh, PA

From Bloomberg's Businessweek:

Harrisburg, Pennsylvania, Files for Bankruptcy, Lawyer Says
The city of Harrisburg, Pennsylvania, facing a state takeover of its finances, filed for bankruptcy protection following a vote by City Council, according to a lawyer for the council.

Mark D. Schwartz, a Bryn Mawr, Pennsylvania-based lawyer and former head of municipal bonds for Prudential Financial Inc.'s mid-Atlantic region, said he filed the documents by fax to a federal bankruptcy court last night. The filing couldn't be confirmed with the U.S. Bankruptcy Court in Harrisburg.

The state capital of 49,500 faces a debt burden five times its general-fund budget because of an overhaul and expansion of a trash-to-energy incinerator that doesn't generate enough revenue.

"This was a last resort," Schwartz said in an interview after the council voted 4-3 to seek bankruptcy protection. "They're at their wits end."

While bankruptcy would mean the loss of state aid under a law passed in June, it's preferable to a proposed recovery plan, said Councilwoman Susan Brown-Wilson.

"We're not incompetent," Brown-Wilson said. "We're just not going to let you run us over with the train anymore," she said, referring to state officials.

A bit more:

The bill would let Republican Governor Tom Corbett declare a fiscal emergency in Harrisburg and name a receiver who would develop a recovery plan. The manager would be able to sell assets, hire advisers and suspend the authority of elected officials who interfere. Unlike in Michigan, the receiver wouldn't be able to change union contracts.

Pity about not being able to renegotiate union contracts as I bet that the pensions and benefits constitute a lot of the city's problems. Not mentioned in the Businessweek article is that Harrisburgh's waste-to-energy facility is a biggie and is a money sink. From Power Magazine, December 1, 2009:

Harrisburg Resource Recovery Facility, Harrisburg, Pennsylvania
After decades of struggling with serious air contamination issues and large financial losses, this Pennsylvania waste-to-energy facility, which was built in 1972, was in need of an extreme makeover. In the wake of an unsuccessful $84 million retrofit attempt in 2005, the faltering facility's last hope lay with a Covanta project team that took over its operation in 2007. After almost two years of hard work, the facility is now producing up to 17 MW while achieving its environmental compliance goals and earning substantial revenues.

Anc Covanta's take on this? From Waste360, Jun. 7, 2007:

Covanta Agrees to Operate Harrisburg Authority's Waste-to-Energy Facility
Covanta Holding, Fairfield, N.J., has announced a 10-year agreement with the Harrisburg Authority to operate its waste-to-energy facility in Harrisburg, Pa. The agreement pays Covanta an annual fee of $10.5 million (subject to annual escalation) to run the 800-ton per day facility, as well as incentives for increased production.

$10.5 Million on up -- this is not chump change. But they had plans -- big big BIG plans; from Stop the Burn:

Harrisburg: Give us trash
The interstate trash wars just took a pro-trash turn: Harrisburg, Pa., wants New York City's garbage.

Harrisburg Mayor Stephen Reed has told Borough President Guy V. Molinari his city is "ready, willing and able to enter an agreement to accept municipal solid waste from the city of New York immediately."

Molinari said the approach by Reed "proves that, all the political rhetoric to the contrary, there are many localities that badly need and want the revenue New York City garbage will bring."

And that, Molinari said, is good news for on-time landfill closure.

Molinari said he's confident Harrisburg would be able to handle the 1,100 tons of trash Staten Island produces daily, although Reed told the Harrisburg Patriot-News that initially the city would be able to accept only 150 tons a day.

All this has a big if attached to it, though. The waste-to-energy incinerator is an aging facility that must undergo $90 million worth of fixing before the year 2000 or the federal Environmental Protection Agency will reduce the amount of waste it can handle to 500 tons a day, not increase it.

The plant now is licensed to burn 720 tons a day, and is almost at capacity. The retrofit will give the Harrisburg plant a capacity of about 960 tons a day, allowing it to accept at least some of New York's waste, Reed said.

But before doing the required renovations, Harrisburg needs to find a way of paying for it.

It is even used as an example of what NOT to do -- from the Maryland Carroll County Times:

Waste-to-energy a positive project
As Frederick and Carroll counties move forward on developing a waste-to-energy facility, it is important to note that the project bears no relationship to the Harrisburg, Pa., facility featured in an Associated Press article printed on April 11, headlined "Incinerator project burns up Pa. capital's cash." The two facilities could not be more different in terms of technology, finances and management.

All signs pointing to yet another example of an pipedream turning into a costly failure...

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This page contains a single entry by DaveH published on October 12, 2011 11:54 AM.

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