Patriot-News, The (Harrisburg, PA) (pg. B01), December 1, 2006

ENGINEER HIRED TO RUN AUTHORITY

By John Luciew

The Harrisburg Authority, which owns the city's utilities, is under new management, and its trouble-plagued trash incinerator soon might be as well.

The authority's three-member board voted unanimously last night to hire engineer Robert Ambrose to run the quasi-governmental agency that also issues municipal bonds to finance public projects.

Ambrose replaces former executive director Tom Mealy, who resigned last month. He will make $82,000 a year.

The authority's board couldn't decide on a plan to manage, staff and run the $80 million trash incinerator in south Harrisburg, tabling a proposed management contract for the plant.

The trash-to-steam plant began its first year months behind schedule and riddled with design flaws. The result is a year-end deficit estimated at $4 million to $5 million.

Authority officials said last night that it will take $14 million to fix the flaws, including replacing the ash-handling systems. The authority is considering turning over management of the incinerator to the firm that built it, Barlow Projects Inc.

Barlow would form a management subsidiary called Harrisburg Resource Recovery Operation LLC that would manage and staff the facility for about $10.5 million annually, according to authority consultant Daniel Lispi. The authority still would own the plant.

Barlow Vice President Ron Barmore said the contract would allow the company to obtain financing for the $14 million in improvements needed to run the plant correctly. He said the firm, not the authority, would pay for the upgrades.

But the deal would put the jobs of the 45 city employees who work at the plant in jeopardy.

Lispi said Barlow would interview all employees but would not be obligated to hire them.

Authority Chairman Fred Clark promised to meet with union officials to address their concerns before any vote.

Lispi said the authority's first obligation is to get the plant working efficiently so it is able to burn at its capacity of 800 tons of trash daily, generate steam and electricity and meet revenue projections.

Otherwise, Harrisburg and its taxpayers -- not the authority -- would be on the hook for about $220 million in incinerator-related debt. The operation's debt payments amount to about $16 million a year for the next 30 years.

The incinerator will miss this year's revenue target by $12.6 million.

JOHN LUCIEW: 255-8171 or jluciew@patriot-news.com

Copyright 2006 The Patriot-News Co