Local Problem and Solution in Harrisburg

Name Instructor Course Date Local Problem and Solution in Harrisburg Problem The change in the Harrisburg’s economic situation mirrors that of other areas where investment projects with little tangible returns have drained resources. Additionally, the decline of the city has been exacerbated by the lack of viable jobs being created, meaning that the revenue base is not enough to meet budget shortfalls. Government policies can facilitate or hinder growth efforts, and it may be necessary to identify effective regulations to attract more businesses and investors in the area (Martin, Levey & Cawley 22S). Effective governance includes fiscal responsibility to use the resources available efficiently, and this extends to identifying investment projects that have highest returns with low cost and are appropriate for Harrisburg’s residents. Even though, renegotiating  the debt plans  is crucial to reducing exposure to default, the more the area attracts businesses and investors the more likely that the conducive environment will attract more businesses and  reduce economic distress in the area. Dependence on a few industries is counterproductive since when these industries become uncompetitive there is a high loss of jobs.  The challenge with declaring bankruptcy is that the city ha slow rating and will find it more difficult to get more money. However, getting more resources from the state is easier than the investors and creditors concerned about the repayment of money lent. Now that the city already declared bankruptcy there is still a challenge to meet financial obligations as they fall due. The delivery of other services also depends on the ability of the city to pay workers and contractors. Providing the basic public services requires that efforts are made to look for more resources to cover for costs. At the same time, there is scale back of these services, but this may also compromise public safety and sanitation. Since bankruptcy in Harrisburg, Pa was related to financial necessity and rebuilding of the incinerator plant, failed to consider the costs and benefits to the residents. Solution              The case for declaring bankruptcy was to offer protection against state takeover and being placed in a position to repay creditors when the city was already suffering financial distress (Fletcher). Even as this was the preferred option at the time, there is a need to improve the financial outlook as the city will still require municipal bonds to support municipal projects. Even though various cities across the US have increasingly struggled with rising debt pile, the inability to grow revenue streams and support for an incinerator plant with no tangible benefits has been a concern to city officials and the public. With an ever expanding population, managing the city of Harrisburg to support long-term growth is a top priority.  The fiscal management of affairs and the local economies influence the viability of the city. Increasing the state funding will plug in the fall in revenue streams, but where there is presence of corporations and businesses in the area this affects the city’s employment levels and stability. The role of the Harrisburg Authority and the mayor of city cannot be ignored when seeking to improve the management of the city.  The case for this is that fiscal mismanagement and economic troubles have affected the city’s efforts towards meeting legal obligations. The long-term recovery efforts will involve matching the revenues with the expenses and costs rather than simply choosing long-term projects without undertaking proper project evaluation.  To promote fiscal responsibility there is a need to involve more stakeholders in the decision making process (Walsh and Hurdle). At the moment the city officials simply selected projects like the incinerator plant without undertaking due diligence. This is also necessary since when more people have a voice in the fiscal matters there is close scrutiny and monitoring the city’s financial status. There were already concerns that Harrisburg Authority had continually pumped money into a high risk project given that the waste management efforts of the city had changed over time.  Since the state of Pennsylvania may intervene to address the long-term fiscal obligations of Harrisburg, it is necessary to address the structural problems. The state efforts are beneficial to improve the long-term finance, but there are also obligations that may constrain the city’s ability to look out for other options beyond the municipal bankruptcies. Municipal bankruptcies rarely occur, and this gives the state officials more leeway to determine the creditors to be paid even as this may not fully facilitate financial rehabilitation (Moringiello 408).  It is unlikely that Harrisburg will undertake other large infrastructural projects without a viable financial plan to address the fiscal problems affecting the city. &n...