Harrisburg, PA moment of default

This blog has details:

How bad is Harrisburg’s PA financial crisis? Consider this: The city’s financial rating has dropped twice since October, and currently sits at junk bond status, but that’s not the worst part. The city may not be able to meet payroll in two weeks and will very likely default on just over $2 million in debt payments due March 1. Even that’s not the worst part.

This year, the city owes an additional $66.7 million in debt payments — more than the entire annual city budget. Much of the problem stems from the Harrisburg Authority’s $288 million in incinerator debt, which Harrisburg has guaranteed. The crisis has already drawn national attention from CNN, Bloomberg News and The Wall Street Journal.

Mayor Linda Thompson’s $65 million budget proposal called for raising property taxes by 20 percent and water bills by 40 percent, but it did not include any concrete plan to deal with the staggering debt payments due this year. That drew sharp criticism from some members of the public, as well as City Controller Dan Miller. Miller is pushing for the city to look into municipal bankruptcy as a possible solution.

Why do mayors hold on to denial until, literally, the last second? The mayor of Los Angeles does the same.