Federal bankruptcy Judge Mary D. France has ruled that Pennsylvania's capital city of Harrisburg may not seek bankruptcy protection, calling such a filing illegal.
France issued the ruling Wednesday after hearing more than two hours of arguments by lawyers as to whether the bankruptcy petition that was filed by Harrisburg City Council could move forward despite the objections of the city's mayor, Pennsylvania Gov. Tom Corbett, Dauphin County, bond issuers and others.
The Susquehanna River city of 50,000 is saddled with about $300 million in debt tied to its nearly 40-year-old trash incinerator.
A City Council member said the group will decide whether or not to appeal.
In the meantime, the Corbett administration is moving to take over many of the city's financial operations in a bid to force it to pay down the debt.
France dismissed many of the arguments made by a lawyer for City Council, but focused arguments on two key areas.
While admitting that she typically doesn't consider matters of state and constitutional law, France had questioned Wednesday whether a four-month-old state law designed to temporarily prohibit a bankruptcy filing by Harrisburg had met state constitutional standards that demand transparency in the passage of legislation.
In the end, she said it did.Page 1 of 2 | Next Page