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Lawyer tapped to take charge in Harrisburg

HARRISBURG — Gov. Tom Corbett on Friday named a public finance lawyer who has served in his administration for several months to take charge of the state’s unprecedented takeover of its financially troubled capital in an effort to force it to pay down a massive debt that drove it to bankruptcy court.

The receiver, if approved by a state court, would have greater power over Harrisburg’s finances than the state already has now, including the power to sell city assets, such as its system of parking garages and lots and its trash incinerator.

The nearly 40-year-old incinerator is the source of Harrisburg’s most pressing financial problem, with about $300 million in debt on it that city leaders have been unable to develop a plan to repay. The city is already tens of millions of dollars behind in payments on the incinerator debt.

The lawyer, David Unkovic, said Harrisburg’s problem is solvable. He pledged a process that is open to everybody involved, including the city, creditors and employee unions, and that would start immediately.

The Republican governor’s administration named Unkovic in a petition filed Friday with the state Commonwealth Court.

The new municipal takeover law, which opponents say is unconstitutional, opens up a legal gray area as to how much authority the state can wield over Harrisburg while the city is seeking bankruptcy protection from creditors.

Unkovic’s appointment as receiver might depend on whether a judge accepts a petition filed in federal bankruptcy court last month by Harrisburg’s divided City Council in an effort to block the state takeover and force creditors, such as Dauphin County and Assured Guaranty Municipal, to forgive part of the debt.

Asked whether he had any concerns about the bankruptcy case, Unkovic said he would deal with those issues as they arise but that the receiver process must go forward because the city needs a recovery plan. Corbett opposes the city’s bankruptcy filing, as does Democratic Mayor Linda Thompson.

For much of his career, Unkovic, 57, has worked as a lawyer advising municipalities on bond issues.

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