Patriot-News, The (Harrisburg, PA) (pg. B08)  [Printer-friendly version]
August 26, 2003


By John Luciew

To hear Harrisburg officials tell it, the city can't afford not to
spend $125 million to renovate its closed and outdated municipal waste

That's because when the old burner's final flame was snuffed out back
in June, the 31-year-old plant was still saddled with $104 million in

The city and its taxpayers remain on the hook to pay back the money
for a plant no longer in service at an average annual payment of about
$7 million through 2030.

"I wish the existing debt were not there, either," said Dan Lispi, the
Harrisburg official in charge of the incinerator project. "But it is
there, and it's something we have to deal with."

If the plant isn't overhauled, it could mean as much as a 5-mill tax
hike -- or an additional $500 a year in city real estate taxes on a
$100,000 home -- to pay off the debt, Lispi said. That doesn't take
into account higher waste disposal fees, long-term dependence on
landfills and mass layoffs of city workers.

That's why Lispi told an audience of about 60 people at last night's
first public hearing on the incinerator that he sees no other
alternative to spending $125 million to renovate the plant.

Then Harrisburg would have what he called a state-of-the-art waste-to-
energy operation. And the city would have a chance of paying off the
debt, which would balloon to $229 million -- and maybe even turn a

Others remained skeptical.

"You'll never convince me," said resident Evelyn Warfield, who
chronicled the financial folly of the first incinerator and presented
a petition against the new project.

But backers insist Harrisburg can make the money by burning 800 tons
of trash a day from Dauphin, Cumberland and Perry counties, and then
selling the steam or the electricity generated in the process. They
said contracts are lined up guaranteeing a waste stream for the plant,
as well as a market for the energy it will produce.

City officials estimate the plant could earn as much as $23.6 million
in its first full year of operation in 2006 -- enough to pay its $9.9
million in annual operating costs, handle the debt payments and begin
building a cash surplus. As early as 2010, the plant could be earning
$26.4 million a year and have $9 million in surplus cash in the bank.

But several residents who turned out for the first of a series of
public hearings on the incinerator's future said they've heard the
rosy projections before -- namely, when the first incinerator was
built and the city repeatedly borrowed money to try to make it
efficient. It never seemed to work, they said.

"I think we'll find that we cannot afford the project," said Michael
Fiorentino, representing the Clean Air Council based in Philadelphia.
"I don't think it's going to provide the revenues they are saying."

And if it doesn't work, city taxpayers would again be on the hook for
the debt payments. In addition, Dauphin County, which plans to direct
that most of the waste generated in the county be sent to the
incinerator, would also pledge to back the project financially --
putting county tax money on the line if it fails.

It will be up to the seven-member City Council to decide if it all
sounds feasible.

Last night, council members gave no hints about which way they might
vote. Instead, President Richard House said members were in a
"listening and learning" phase. Two more public hearings are scheduled
for early next month.

The council is expected to vote on the incinerator project and the
$125 million bond issue on Sept. 23, according to a timeline released
last night. The Harrisburg Authority, which would actually float the
bonds, would vote on the financing the following day, and the Dauphin
County Commissioners would vote on whether to back the financing on
Oct. 7.

If approved at all of those steps, the plant could be completed by
December 2005, with Barlow Projects Inc. designing and constructing
the renovations.

JOHN LUCIEW: 255-8171 or

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