It was a whirlwind. From start to finish.
Notice of press conference at the Office of the Receiver. Soon. Be there, right? Yes, I’ll be there.
Hurriedly getting to the Capitol Complex, to the Finance Building, to a back corner on the 4th floor, the significance of what Receiver David Unkovic was about to do was gripping.
The message was clear–Unkovic was calling this press conference to discuss the March 22nd Order issued by Dauphin County Judge Todd Hoover. The Order declared that creditors TD Bank, M&T, Bank of New York Mellon, and bond insurer Assured Guaranty (AGM) were entitled to a receiver for the Incinerator in order to control the machine’s operations and budget. They had been asking for one since September 2010 and now they won. With that, the City of Harrisburg was about to host two receivers—one for the City and one for its infamous Incinerator.
Since he was appointed in December, Receiver Unkovic had asked the creditors to hold off on their litigation, to give him a chance to develop a Recovery Plan for the City then begin to implement it. They refused and pushed full steam ahead.
And this “full steam ahead” approach was the focus of the Harrisburg Receiver’s presser today.
As I watched, tweeted, and noted David Unkovic give his statement to a small number of reporters in his office, I knew this was historic. Unkovic delivered blows. He named names. He was frank about his concerns. He talked of “joint venture” and “parties” and referenced a timeline of people, places, and things that have happened to put the City of Harrisburg where it’s at—in trouble.
He declared it is all “extremely upsetting as I’m trying to do a fair process.”
Naturally, Unkovic was careful since he clearly is a careful man, but the veil is lifting and his intentions are becoming evident. Anyone who has ever touted conspiracy theories about who this man is aligned with, well, let it be known those theories were blown out of the water today. In fact, he hinted at the politics that impose themselves on anything and everything the City does, including trying to recover from years of abuse. First saying that Harrisburg’s problems are both fiscal and political and that sometimes the intertwine of the two complicates matters, later he affirmed, “It’s very important that the process moves forward without influence of the creditors.”
Not only did he identify the principle creditor AGM to support his statement, but he also ventured into the land of the elected. He named names.
First up was Dauphin County Commissioner Jeff Haste. As many of you know, Haste has not been kind to the City of Harrisburg. It is widely notioned that he thinks of the City as that place with its problems, not necessarily as a cohesive, favorable part of Dauphin County. Yet, what Unkovic highlighted today was what many of us have been saying for a long time—Haste is part of Harrisburg’s problems.
Haste has been in office for a long time after first being appointed a Commissioner in 2002. Deeply entrenched in a network of Central PA politics, Haste seemingly values himself as one of the right people who knows what’s best with little tolerance for those outside of that realm.
In Dauphin County, he’s the man that calls the shots.
Indeed this was emphasized today. Unkovic pointed out that Haste signed multiple financial certificates for the Incinerator retrofit bonds which were presented to PA Department of Community and Economic Development (DCED) assuring that the new debt would be self-liquidating. What this means is that in order to get the bonds through the State’s approval, the new debt had to pay itself off via an operating Incinerator. At the time of issuance, the Incinerator wasn’t working. No revenue equals no means to make debt payments equals no “self-liquidating debt.” Yet, Haste apparently used his signature as Dauphin County Commissioner to make the deal happen.
Which leads us to another player in the true Harrisburg debt story–Senator Jeff Piccola. During Unkovic’s press conference, he referred to the closing of the Dauphin Meadows landfill and Piccola’s position on that. Now, this is another history lesson but an important one. In 1990, Senator Piccola fought against the Incinerator and fought for use of the landfill for Dauphin County trash. The State agreed and all County trash went away from the Incinerator and to the landfill. When that happened, the Incinerator lost immense value over night.
Ten years later in 2000, Piccola switched sides, dramatically and flamboyantly. He decried the landfill a nuisance and joined in a community-based lawsuit to shut it down. Piccola announced the Incinerator should be used for all Dauphin County trash.
And it was. Dauphin County entered into a municipal waste agreement with the City and The Harrisburg Authority. It is because of this agreement—and only because of this agreement—that the broken, deprived Incinerator was able to get financed to get fixed, since Dauphin County would guarantee the bonds. Piccola helped make it happen.
But Unkovic didn’t stop his list of naming names there. He called out the lobbyist Stan Rapp of Greenlee Partners, who is the lobbyist for both Dauphin County and for the bond insurer AGM. As we discovered last Fall, Stan Rapp was part of numerous meetings with the Governor and the Governor’s representatives about Harrisburg’s Act 47 process, which eventually became the City’s takeover by the State pushed by Dauphin County officials and Senator Piccola.
The Receiver was sure to say that he in no way criticized Judge Hoover for his recent ruling in the creditors’ favor, but Unkovic said, “I have great concerns about the parties who are pushing this litigation.”
“extremely upsetting as I’m trying to do a fair process.”
Those parties are AGM and Dauphin County who are both represented by the lobbyist Stan Rapp. This bears repeating.
Then there are the financiers–the Royal Bank of Canada’s James Losty, whom Unkovic referred to as “close to Reed.”
Of course, there’s the former Mayor himself, Stephen Reed. What’s remarkable lately is listening to Dave Unkovic—in courtrooms, in press conferences, in interviews–refer to Reed. Last week when Unkovic used the word “corruption” on the stand, it instantly struck me that this was the man that takes Steve Reed down. This bespectacled gent with his bow tie and measured, deliberate ways is the one to tear down the facade of idolatry that is Steve Reed.
Today was no different. Unkovic commented on Reed’s circle which included the above named as well as Representative Ron Buxton.
While Unkovic himself didn’t say this publicly, at this point in the story, the question is begged—Isn’t it ironic that both of the City of Harrisburg’s long-time legislators are retiring this year, Senator Piccola and Representative Buxton?
The most curious phrase Receiver David Unkovic used today was “joint venture.” He said as he sees it, there are three major parties who entered into a “joint venture” to finance the Incinerator. Steve Reed, Dauphin County, and AGM. Not only was there a “joint venture” of the parties, asserted Unkovic, but it was a “risky joint venture.” Using the hiring of Barlow as an example, he said, “Basically they were rolling dice and it came up snake eyes. Eventually.”
“Eventually” has been a slow grow to now. At this moment and with this historic action by Pennsylvania’s first ever municipal receiver, David Unkovic, the realization of years and years of cronyism, arrogance, and public ignorance is reaching its peak and is becoming a metaphor not just for irresponsible public management in Harrisburg, but for the proposition of democracy everywhere.
Unkovic seeks to tackle this by calling on U.S. Attorney Peter Smith and State Attorney General Linda Kelly to investigate possible criminal activity found within the Incinerator’s Forensic Audit Report. While the Receiver maintains that he and his attorneys are still in the midst of a complex analysis of the Report, he’s apparently seen enough to take the next step. At his press conference, he read aloud a short and sweet letter calling on the attorneys to look into what’s going on. It’s dated today, March 28, 2012.
Corruption. It was the word David Unkovic used on the stand last week in Federal Court. Today he explained his use of that word. Prefacing his explanation with the fact that he used that term not as a lawyer, he said, “I meant corrupt in the sense of a body being corrupted. Deteriorated.” He went onto say, “It’s just a bad situation.”
It is a bad situation and there have been many people inside and outside of the City of Harrisburg who have said so. It’s bad and it’s been bad. But what’s really bad is that there are elected officials in office helping to make it bad either through incompetence or self-preservation. They are parties pushing, not just to potentially cover up whatever they did or didn’t do, but to seemingly still get more out of this place. As Unkovic said today, everything was arranged and signed in such a way that the burden fell on the City’s shoulders. There’s no relief of that burden if Dauphin County or even some of our State officials have it their ways.
Towards the end of the presser, when the press was asking questions, one reporter said to Unkovic that in a recent interview with Senator Piccola, Piccola said the Receiver needed to stop engaging with the people of Harrisburg and sit down and get his plan done. Calm at first saying he wouldn’t speak to a claim of what may have been said, Unkovic then showed his frustration by saying that there was no way recovery was going to be successful in Harrisburg without such engagement. Time and time again, he said, “I’m trying to do what’s best for the residents of the City of Harrisburg.”
What he doesn’t know, perhaps, is that we’ve not ever been engaged like this before. We’ve never been asked for our thoughts, opinions, or ideas…..except in practices of placation. We’ve never had access to the truth like we do now.
And people like Haste and Piccola know it and like it that way.
The idea of engaging the Harrisburg community like Unkovic is, this is novel and there is absolutely, without doubt, those who would like to keep the status quo in place. There are those in power who like the power of the People shrouded in ambiguity, ignorance, and apathy.
“I’m very concerned about the environment with which I’m trying to get this recovery done,” Unkovic revealed.
Yes, sir, it’s the same environment the City’s been suffering in for awhile. At least now, though, there are more of us together seeing the same things and saying so, trying to combat the suffocating morass of failed leadership that Harrisburg has barely endured. Welcome to the ranks, Mr. Unkovic. It’s good company.