Shamokin bank account open, ready for Act 47 loan
SHAMOKIN - A new city bank account is empty now, but it should soon hold more than $1 million and keep Shamokin afloat through the end of 2014.
Treasurer Brenda Scandle created the account in anticipation of the receipt of a $1,163,500 interest-free loan through the state's Act 47 program for financially distressed municipalities. It is expected by mid-August, around the time it's predicted Shamokin will run out of cash.
No one at City Hall is sure exactly when the money will be available. When it is, more than $811,000 in unpaid bills from 2013 are expected to be paid. The rest will be used frugally, city officials have said, on only necessary expenditures.
Financial Solutions, which assisted Shamokin in its creation of an Early Intervention Plan this year, is contracted to be Shamokin's financial adviser for Act 47. The firm's Ryan Hottenstein was at City Hall on Thursday to help begin the creation of a long-term financial recovery plan. He expects to visit the city at least once each of the next seven weeks.
Shamokin is the 21st active member of the state's Act 47 recovery program. Apart from the loan, Shamokin will receive preference for state grant programs and will consultations from financial, legal and operations experts. The Department of Community and Economic Development (DCED) along with Financial Solutions will provide oversight, but elected city officials have ultimate responsibility for the city's policies and day-to-day management.
DCED has declared 28 municipalities as distressed since 1987. Seven municipalities have successfully emerged from the program, including Shenandoah. Some have remained in the program for more than two decades.