Courtesy of Mish.
Congratulations to Harrisburg, the capital of Pennsylvania, for having the highest per capita debt of any city in the country.
The town’s 50,000 citizens are on the hook for $1.5 billion according to the NPR article Inside America’s Most Indebted City.
The city has delayed payments to light bulb venders and paper sellers. Restaurants have hired their own security. A local strip club paid to keep the street light on. The city is projected to run out of money entirely in October.
A judge has recently ordered a 1% income tax hike on the people still left in Harrisburg. But the city council has promised to fight it.
$1.5 Billion Does Not Include Schools, Pensions, Unfunded Liabilities
The Patriot News notes Harrisburg’s eye-popping debt total is just one piece of city’s bleak financial puzzle
It’s almost impossible to say exactly how much money the elected and appointed officials of Harrisburg have borrowed.
Missing financial audits, complicated transactions and intertwining finances create a labyrinth of money that stretches decades into Harrisburg’s history.
At best estimates, based upon reviews of independent reports and audited financial statements, the amount of debt owed by the city and its affiliated entities — with interest — stands somewhere north of $1.5 billion.
That’s roughly $30,285 for each of the 49,528 men, women and children living in the city and almost twice the income of the average city resident.
While the amount of debt is eye-popping, it is only one piece of the jigsaw puzzle that is the city’s bleak financial background.
It does not account for past-due debt payments or unfunded pension and healthcare obligations. Nor does it include the estimated annual deficits in the city’s and school district’s budgets, which this year are so far estimated at $6.8 million for the city and at least $7 million for the school district, even with drastic cuts such as eliminating kindergarten.
A declining tax base contributes to the overall problem — between 2009 and 2012, the assessed value of property in the city dropped by more than $30 million, according to a school district report.
Meanwhile, each time property taxes increase, fewer people pay them. According to a school district report, property tax collection rates have fallen from 87 percent to 83 percent. …
