Bipartisan Municipal Debt Reform Package


(Harrisburg) – Today, Senators Mike Folmer (R-48), John Eichelberger (R-30), John Blake (D-22) and John DiSanto (R-15) and State Representatives Francis Ryan (R-101) and Patty Kim (D-103) highlighted a bipartisan municipal debt reform package to address financial transactions that led to the fiscal distress of Harrisburg and other municipalities.

“Tax and rate payers across Pennsylvania assume there are protections in the law to stop public entities from losing public funds on risky investments, or contractors that go under during a project, or engaging in unethical financial practices; currently, these protections don’t exist,” said Senator Eichelberger, prime sponsor of Senate Bill 490 (Local Government Debt Act) and Senate Bill 493 (Bonds and Municipal Debt).  “Our bipartisan package of bills will correct these inadequacies.”

Senator Folmer, prime sponsor of Senate Bill 492 (“Swaps” Restrictions) continued, “As the Grand Jury report on the Harrisburg incinerator called the City’s financial transactions ‘a reckless bet,’ I believe swaps are gambling with taxpayers’ moneys.  If municipal or school district officials guess wrong, taxpayers are on the hook for any losses incurred.”  Representative Ryan will introduce companion legislation in the House.  “As part of a comprehensive financial rescue plan, it is essential that reforms be enacted at the state and municipal levels to ensure our financial viability into the future,” Representative Ryan said.

“It is imperative that we continue to legislate protections in law to ensure accountability and transparency in publicly funded activities,” Senator Blake added.  “This bipartisan package of legislation protects the public interest; improves transparency and accountability; and insists upon ethical conduct when local elected and appointed officials vote to issue debt backed up by taxpayer dollars.  It is my hope that these bills move quickly through the legislative process and get to the Governor’s desk for his signature.”  Senator Blake is the prime sponsor of Senate Bill 491 (Ethics Commission and Municipal Authorities).

Attorney General Josh Shapiro recently released a Grand Jury report on the financial transactions of the Harrisburg incinerator.  While a number of the Attorney General’s recommendations on the Harrisburg incinerator are covered by the previously mentioned bills, three additional bills will be introduced to include all of the recommendations.

Senator Blake will introduce Senate Bill 694 to amend the Commonwealth Attorneys Act.  Senator DiSanto will introduce Senate Bill 695 to amend the statute of limitations regarding public officials and employees.  “Public officials need to be held to a high standard and face accountability when they violate the public trust.  This legislation, recommended in a recent report by the Attorney General, will clarify the statute of limitations on crimes related to public employment and provide sufficient time for investigations to be conducted after someone has left office,” Senator DiSanto said.  Senator Folmer will introduce Senate Bill 696 to expand public bidding requirements for professional services.

Representative Kim will introduce similar companion bills in the House.  “I believe if these reform bills were law 20 years ago, Harrisburg’s financial status would look completely different and on better footing today,” Representative Kim said.

Senate Bills 490-493 are currently in the Senate Local Government Committee.  Senate Bills 694-696 will be introduced shortly.


Fred Sembach, Senator Folmer (787-5708)
Lee Derr, Senator Eichelberger (787-5490)
Luc Miron, Senator Blake (787-6481)
Charles Erdman, Senator DiSanto (787-6801)
Representative Ryan (783-1815)
Representative Kim (783-9342)