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HARRISBURG - Likened by critics to a Ponzi scheme and expected to cost up to million to negotiate, an updated version of a 0 million public parking deal were presented Thursday to local elected officials in Pennsylvania's capital city.
"Let's be honest," said former independent mayoral candidate Nevin Mindlin."It's just a ."
Mindlin, one of three Harrisburg residents to attend the three-hour hearing at City Hall, was booted from the ballot because he left part of his nominating petition blank later .
Mindlin has voiced opposition to plan to restructure 0 million of local public debt since it was filed Aug. 26 by the state Office of the Receiver.
He - and others - took issue with the plan's failure to detail some of its critical components initially. They were concerned with some of the things that were spelled out right away, too, such as increasing parking fines and continuing the higher earned income tax rate.
The deal, he said Thursday, strips the city of its assets and turns its residents into "indentured servants."
Supporters of the receiver's plan - including its own architects - acknowledge it's not perfect. Their intent is, essentially, to give Harrisburg a fresh start.
Proceeds from the parking deal, for example, will free the city of some of of those obligations, settle another million or so of unpaid bills, and generate million to fund economic development, repair infrastructure and defray costs to meet post-employment benefit obligations to former city workers.
City parking tax revenues also will increase by .4 million to .3 million annually because the transaction will erase some of debt obligations tied to its parking authority, said the receiver's financial consultant Steve Goldfield.
"You don't have access to that now," he said, referring to revenue currently cannibalized by those debt obligations.
The updated version of the parking agreement presented Thursday isn't complete.
But within the next week, it will be, or very close to it, according to the timeline presented Thursday by Goldfield.Monday: CREDC agreement to administer bonds on behalf of thinly staffed issuer Pennsylvania Economic Development Financing Authority (PEDFA).
Tuesday: City Council's second reading and enactment of ordinancesWednesday: Harrisburg Parking Authority meeting to approve asset transfer agreement, lease and other aspects of transactionThursday: Finalize leases with Department of General Services committing state to rent worker parking spaces, and PEDFA. Finalize management and operating agreements with PEDFA, as well as a trust indenture to include provisions such as one subjecting an advisory board to Standard Parking and PEDFA to public access and records lawsAlso Thursday: submit packages to ratings agencies, i.e., entities with the most bearing on interest rates which will conclusively determine whether the transactions will generate enough money to make the deal workable.Monday, Oct. 18: receiver's attorneys get trust indenture and leases
Interest rates will determine the exact amount of proceeds, but estimates have ranged between 8 million and 0 million during the past several months.
No matter the rate, the city is locked in at a .2 million cut of proceeds, according to Goldfield, who helped do The Harrisburg Authority forensic audit credited with revealing some of the city's worst financial practices. Ultimately, that led to and has
That means if are down when pricing is expected to occur next month, the city doesn't get more money.
If rates are up, however, the city's interests would be protected -- to a point.
If rates go too high, that will kill - or delay - the deal. .
Basically, the parking lease and incinerator sale must generate at least 0 million to settle the city's biggest debts to Dauphin County and Assured Guaranty Management. The county and AGM have made it clear that they won't take any less up front.
Should interest rate spikes prevent that, negotiations will have to backtrack, Goldfield said.
Debt deal talks already have racked up bills for lawyers, consultants and other professionals totaling between million and million, Goldfield said Thursday.
And that's just one of the 0 million debt restructuring's two major pieces (there are a bunch of minor ones, too).
Some - but not all - of those negotiating costs will be borne by the city.
The bills Goldfield referenced include, for example, ,000 for independent reviews by consultants of the overall plan and by attorneys of the parking deal specifically. Paid with money budgeted for City Hall spots that went unfilled this year, those experts have not expressed significant concern with the plan.
The receiver's million annual budget will cover some costs, too.
Goldfield promised to provide City Councilman Brad Koplinski and others with the "long list" of who's getting paid.
About 50 professionals likely will be named, City Council's attorney Neil Grover said.
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