Ford City Borough Considers Bankruptcy
At Ford City’s council meeting this month, local residents and council members voiced their concerns about the borough’s economic future, which doesn’t appear promising.
The borough has been struggling financially for some time. Since the Department of Environmental Protection fined the borough for problems with its plans for a new water plant and the Greater Ford City Community Development Corporation folded, Ford City has been sinking further and further into debt.
According to The Kittanning Paper, the council has now voted to request proposals for consulting firms for the state’s Department of Community and Economic Development Early Intervention Program, in a last-ditch effort to prevent Ford City from being forced into Act 47. Some council members warned that Act 47 is not a desirable option.
Other communities have seen their taxes raised to increase revenue, and a loss of authority in bargaining and arbitration on key issues like police employees. Enrolling in the Economic Development Early Intervention Program might be costly and was not the number-one choice for all council members, but supporters hope it could help get Ford City back on its feet with manageable long-term financial plans.
The Municipal Financial Recovery Act was developed to help financially troubled communities that have defaulted on loans, spent in excess of their revenue for three years or otherwise shown serious signs of debt. The act restructures the debt of struggling municipalities, offering consolidations or mergers for adjoining municipalities to lessen mediate financial hardship, restricting their eligibility for government funding, authorizing their participation in federal debt adjustment actions and even authorizing bankruptcy actions.
Although bankruptcy is often a viable option for consumers, the case is significantly different with municipal bankruptcies, which are only considered in dire situations. To learn more about how bankruptcy can provide relief for individuals, work with a trusted lawyer in Pennsylvania.
Contact us at Harold Shepley & Associates at 1-866-284-7062 or visit us at shepleylaw.com.
October 6, 2014 Posted in Bankruptcy, Chapter 13 Tagged city bankruptcy, Ford City bankruptcy, Municipal Financial Recovery Act Leave a comment
