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Posted: 9/13/2010 3:45:40 AM EDT
[Last Edit: 9/13/2010 8:52:58 AM EDT by RI0T]
By Aline van Duyn in New York

Published: September 12 2010 20:12 | Last updated: September 12 2010 22:38

The state of Pennsylvania has stepped in to help its capital city Harrisburg avoid a default by advancing next year’s state aid so that the money can be used to make a $3.3m bond interest payment due this week.

On Sunday, Ed Rendell, the governor of Pennsylvania, announced a $4.3m cash transfer and said missing the bond payment was "not an option”. "Harrisburg’s financial future is still very cloudy, and difficult decisions still need to be made to return this city to financial stability,” he said in a statement. "Allowing a missed bond payment, however, would not be a good decision.”


For many months, Harrisburg officials have been debating how to handle its debt burdens and whether the city should follow a handful of other cities that have filed for bankruptcy.Harrisburg’s strains have been closely watched as other US local governments and states
struggle to close gaps in their budget amid falling tax revenues in the downturn.

Harrisburg has already defaulted on $282m of debt in an incinerator project that the city partially guaranteed. The $3.3m payment due on September 15 is an interest payment on the city’s general obligation bond sold in 1997.

Such municipal debt is sought out by many investors in the $2,800bn US municipal bond market because the GO bonds have a reputation as being safer than many other types of bonds.

Payments take priority over other spending. A default on such a GO bond could have knock-on effects across the municipal bond market, increasing the interest payments that are demanded by investors and leading to a reassessment of default risks.

Politically, there can be incentives for cities not to pay bondholders if it means that services do not have to be cut, although many GO bonds are held by local residents who get tax breaks for buying such debt.

As well as paying bondholders, $850,000 of the money will be used to pay Scott Balice Strategies, a financial management company, to "develop a comprehensive plan for the city’s financial stability”.

Last week, Linda Thompson, Harrisburg’s mayor, proposed "painful steps” to tackle the budget deficit including the closing of a fire station and further layoffs. "There are more difficult decisions to be made in the near future,” Ms Thompson said last week.

Mr Rendell said in Sunday’s statement that bankruptcy should not be an option for Harrisburg until all other options had been exhausted. Sunday’s deal includes a $500,000 loan that Harrisburg will have to repay once its finances improve.




And This from WikiPedia:

Scott Balice Strategies, LLC, or Scott Balice, is a financial advisory firm headquartered in Chicago. The firm was founded in 2003 and is now one of the largest woman-owned financial advisory firms in the nation.[ It is ranked overall as the top financial advisory firm in Illinois, fourth in the Midwest, and 15th in the nation for 2008 according to the annual Thomson Reuters ssurvey

Scott Balice provides strategic financial services to governments, corporations, and nonprofit organizations worldwide. It maintains offices in Chicago, New York City, New Jersey, and Alaska, providing services in five core areas: capital markets, swaps and derivatives, public-private partnerships, arbitrage rebate, and financial advisory services






At least those people laid off should take comfort in the fact that Obama's buddies are getting their cut.

links:











Link Posted: 9/13/2010 4:00:04 AM EDT
Could you have used a smaller print?
Link Posted: 9/13/2010 4:16:10 AM EDT
Originally Posted By RI0T:
By Aline van Duyn in New York

Published: September 12 2010 20:12 | Last updated: September 12 2010 22:38

The state of Pennsylvania has stepped in to help its capital city Harrisburg avoid a default by advancing next year’s state aid so that the money can be used to make a $3.3m bond interest payment due this week.

On Sunday, Ed Rendell, the governor of Pennsylvania, announced a $4.3m cash transfer and said missing the bond payment was "not an option”. "Harrisburg’s financial future is still very cloudy, and difficult decisions still need to be made to return this city to financial stability,” he said in a statement. "Allowing a missed bond payment, however, would not be a good decision.”


For many months, Harrisburg officials have been debating how to handle its debt burdens and whether the city should follow a handful of other cities that have filed for bankruptcy.
Harrisburg’s strains have been closely watched as other US local governments and statesstruggle to close gaps in their budget amid falling tax revenues in the downturn.

Harrisburg has already defaulted on $282m of debt in an incinerator project that the city partially guaranteed. The $3.3m payment due on September 15 is an interest payment on the city’s general obligation bond sold in 1997.

Such municipal debt is sought out by many investors in the $2,800bn US municipal bond market because the GO bonds have a reputation as being safer than many other types of bonds.

Payments take priority over other spending. A default on such a GO bond could have knock-on effects across the municipal bond market, increasing the interest payments that are demanded by investors and leading to a reassessment of default risks.

Politically, there can be incentives for cities not to pay bondholders if it means that services do not have to be cut, although many GO bonds are held by local residents who get tax breaks for buying such debt.

As well as paying bondholders, $850,000 of the money will be used to pay Scott Balice Strategies, a financial management company, to "develop a comprehensive plan for the city’s financial stability”.

Last week, Linda Thompson, Harrisburg’s mayor, proposed "painful steps” to tackle the budget deficit including the closing of a fire station and further layoffs. "There are more difficult decisions to be made in the near future,” Ms Thompson said last week.

Mr Rendell said in Sunday’s statement that bankruptcy should not be an option for Harrisburg until all other options had been exhausted. Sunday’s deal includes a $500,000 loan that Harrisburg will have to repay once its finances improve.




And This from WikiPedia:

Scott Balice Strategies, LLC, or Scott Balice, is a financial advisory firm headquartered in Chicago. The firm was founded in 2003 and is now one of the largest woman-owned financial advisory firms in the nation.[ It is ranked overall as the top financial advisory firm in Illinois, fourth in the Midwest, and 15th in the nation for 2008 according to the annual Thomson Reuters ssurvey

Scott Balice provides strategic financial services to governments, corporations, and nonprofit organizations worldwide. It maintains offices in Chicago, New York City, New Jersey, and Alaska, providing services in five core areas: capital markets, swaps and derivatives, public-private partnerships, arbitrage rebate, and financial advisory services






At least those people laid off should take comfort in the fact that Obama's buddies are getting their cut.

links:













Link Posted: 9/13/2010 4:20:03 AM EDT
Link Posted: 9/13/2010 4:21:04 AM EDT
What are you a freakin' wise guy?
Link Posted: 9/13/2010 4:21:43 AM EDT
From what I can tell, Harrisburg is taking very few steps to cut expenses. I don't know what is going on down there, but friends from the area tell me no one is willing to start cutting jobs and programs.
Link Posted: 9/13/2010 4:21:50 AM EDT


Holy shit....can't...stop....laughing!

Link Posted: 9/13/2010 4:21:59 AM EDT
Originally Posted By R_Fury:
Could you have used a smaller print?

WYSIWYG editors for the fail. Don't blame the OP.

In most browsers, just hold down the <ctrl> key and tap the <+> key until you can read it easily. When all done, hit <ctrl><zero> to get back to the original text size.
Link Posted: 9/13/2010 4:24:24 AM EDT
Originally Posted By WhyTanFox:
Originally Posted By R_Fury:
Could you have used a smaller print?

WYSIWYG editors for the fail. Don't blame the OP.

In most browsers, just hold down the <ctrl> key and tap the <+> key until you can read it easily. When all done, hit <ctrl><zero> to get back to the original text size.


Huh....learn something new every day, thanks.
Link Posted: 9/13/2010 4:43:40 AM EDT
I heard Sacramento, CA is a billion dollars in the hole.

WTF?

I could understand a few million, but a billion? Poor leadership.
Link Posted: 9/13/2010 4:44:25 AM EDT

Originally Posted By WhyTanFox:
Originally Posted By R_Fury:
Could you have used a smaller print?

WYSIWYG editors for the fail. Don't blame the OP.

In most browsers, just hold down the <ctrl> key and tap the <+> key until you can read it easily. When all done, hit <ctrl><zero> to get back to the original text size.

Thanks!!!! You just made it a LOT easier to read these threads on my netbook!
Link Posted: 9/13/2010 4:45:55 AM EDT

Originally Posted By madmathew:

Originally Posted By WhyTanFox:
Originally Posted By R_Fury:
Could you have used a smaller print?

WYSIWYG editors for the fail. Don't blame the OP.

In most browsers, just hold down the <ctrl> key and tap the <+> key until you can read it easily. When all done, hit <ctrl><zero> to get back to the original text size.

Thanks!!!! You just made it a LOT easier to read these threads on my netbook!
Ctrl and the mouse wheel also does the same.

Link Posted: 9/13/2010 4:54:21 AM EDT
Last week, Linda Thompson, Harrisburg’s mayor, proposed "painful steps” to tackle the budget deficit including the closing of a fire station and further layoffs. "There are more difficult decisions to be made in the near future,” Ms Thompson said last week.

Here we go with closing the Fire Stations again. I guess laying off cops will be next as that is the only tune these overspending cities know. Sucks to be the taxpayer in PA but that is something the voters there can do something about if they have the will to do so.



Link Posted: 9/13/2010 5:00:17 AM EDT
Originally Posted By packingXDs:

Originally Posted By madmathew:

Originally Posted By WhyTanFox:
Originally Posted By R_Fury:
Could you have used a smaller print?

WYSIWYG editors for the fail. Don't blame the OP.

In most browsers, just hold down the <ctrl> key and tap the <+> key until you can read it easily. When all done, hit <ctrl><zero> to get back to the original text size.

Thanks!!!! You just made it a LOT easier to read these threads on my netbook!
Ctrl and the mouse wheel also does the same.



Learn something everyday. Ctrl + wheel works great. Thanks for the tip.


Link Posted: 9/13/2010 6:56:30 AM EDT
apply tar and feathers, then cut welfare 100%.
Link Posted: 9/13/2010 7:00:23 AM EDT
It amazes me that they hire a finance organization when the answer is so obvious to all. Spend less. By hiring a consultant, they get what they really want, and that is a skapegoat.
Link Posted: 9/13/2010 7:00:58 AM EDT
Originally Posted By 1srelluc:
Last week, Linda Thompson, Harrisburg’s mayor, proposed "painful steps” to tackle the budget deficit including the closing of a fire station and further layoffs. "There are more difficult decisions to be made in the near future,” Ms Thompson said last week.

Here we go with closing the Fire Stations again. I guess laying off cops will be next as that is the only tune these overspending cities know. Sucks to be the taxpayer in PA but that is something the voters there can do something about if they have the will to do so.





Police and Fire are the largest expenses in the budget of the city I work in. So, take that for what it is worth.

dvo

Link Posted: 9/13/2010 8:44:42 AM EDT




LOL dat's funny shit.

Sorry bout that, had to go to work PDQ and just hit send and then fo'd.

But as an earlier poster said, just hit control plus keys.


Link Posted: 9/13/2010 8:51:42 AM EDT


WIN! Its so full of it!
Link Posted: 9/13/2010 8:53:41 AM EDT

there.

that should do it...




Link Posted: 9/13/2010 8:55:51 AM EDT
[Last Edit: 9/13/2010 9:00:08 AM EDT by callgood]
Originally Posted By R_Fury:
Could you have used a smaller print?


Quityerbitchin'

First thing I've been able to read since my double cataract surgery.

We do things differently down here. After the local pols screwed the populace on a sewer deal (some of them are in the slammer) Birmingham sewer rates went up 327%.

There's talk of the appointment of a honcho to set rates in the future. +500% is being kicked around. Also, "non-user" charges (septic tank folks) may be assessed.



Link Posted: 9/13/2010 9:02:03 AM EDT
Very fascinating article thanks for posting that.

Link Posted: 9/13/2010 9:05:56 AM EDT
Originally Posted By 1srelluc:
Last week, Linda Thompson, Harrisburg’s mayor, proposed "painful steps” to tackle the budget deficit including the closing of a fire station and further layoffs. "There are more difficult decisions to be made in the near future,” Ms Thompson said last week.

Here we go with closing the Fire Stations again. I guess laying off cops will be next as that is the only tune these overspending cities know. Sucks to be the taxpayer in PA but that is something the voters there can do something about if they have the will to do so.





Shssssh, you are giving away the secret. Govt spending cut threats usually start with Fire/Police eventually move to teachers (never school admin bloodsuckers) and then on to park closings and maybe homeless giveaways. They never seem to get around to bloated, worthless bureauocrats and other worthless funding - including Fire/Police overhead much less some politically connected finance consultancy.

Plus, these payoffs/bailouts inevitably roll up to the feds who can't wait to bail out PA and CA.
Link Posted: 9/13/2010 9:13:55 AM EDT

Originally Posted By AR-180:
It amazes me that they hire a finance organization when the answer is so obvious to all. Spend less. By hiring a consultant, they get what they really want, and that is a skapegoat.



well, if they are serious about spending less, an outside consultant does provide some cover. any cuts to be made can be explained or defended as being recommended and the ideas not being attached to any particular official.

does it happen is the real question.


Link Posted: 9/13/2010 9:28:04 AM EDT
Originally Posted By 1srelluc:
Last week, Linda Thompson, Harrisburg’s mayor, proposed "painful steps” to tackle the budget deficit including the closing of a fire station and further layoffs. "There are more difficult decisions to be made in the near future,” Ms Thompson said last week.

Here we go with closing the Fire Stations again. I guess laying off cops will be next as that is the only tune these overspending cities know. Sucks to be the taxpayer in PA but that is something the voters there can do something about if they have the will to do so.





Naturally, those services that the public ACTUALLY can see are the first cuts. You wouldn't want your back door deals to end....

BUT, don't forget. WE HAVE TOO MANY COPS. The Clinton's passed that law, hiring 100,000 more cops, and even paid for it for 2 years. AFTER THAT, IT BECOMES THE STATES AND CITIES WHO HAVE TO PAY. So the federal .gov makes you hire someone you can't afford.

THEN WHEN THEY GET CUT, PEOPLE LIKE YOU PISS AND MOAN.

THERE ARE TOO MANY COPS.

But I would rather that, than the back door deals each city does to enrich the city council, just like federal pork does nothing but enrich the rep who did it.

YOU'RE BEING PLAYED.

TXL
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