Bloomberg News

Harrisburg Judge Sets Emergency Hearing on Routine Bills

October 27, 2011

(Updates with court papers excerpt in third paragraph.)

Oct. 27 (Bloomberg) -- An emergency hearing in the Harrisburg, Pennsylvania, bankruptcy case was scheduled to consider payments to city vendors after Mayor Linda Thompson said suppliers wanted court approval of their bills.

U.S. Bankruptcy Judge Mary D. France scheduled a Nov. 1 hearing to consider giving the city approval to pay routine bills as well as creditors who submitted bills before the Oct. 11 bankruptcy case was filed.

“The city has the funds to pay its vendors,” Thompson said in court papers filed today. Thompson sought approval for the bills after vendors, including insurance providers, employees and suppliers “expressed concern about receiving payments without confirmation by the court of the city’s authority to make such payments.”

Thompson and state and county officials oppose the bankruptcy, which was authorized by a majority of the city council. The judge set a hearing for Nov. 23 to decide whether to dismiss the case as Thompson, state and county officials have requested.

Harrisburg, the state’s capital with a population of 49,500 and the seat of Dauphin County, faces a debt five times its general-fund budget because of an overhaul and expansion of the incinerator, which doesn’t generate enough revenue. Guaranteed debt is about $242 million, with $65 million of it overdue, the bankruptcy petition said.

The case is In re City of Harrisburg, Pennsylvania, 11- 06938, U.S. Bankruptcy Court, Middle District of Pennsylvania (Harrisburg).

--Editors: Mary Romano, Charles Carter

To contact the reporter on this story: Steven Church in Wilmington, Delaware, at schurch3@bloomberg.net.

To contact the editor responsible for this story: John Pickering at jpickering@bloomberg.net.


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