News Column

Scranton moving to sell parking garages

August 11, 2014

By Jim Lockwood, The Times-Tribune, Scranton, Pa.



Aug. 11--Scranton's plan to sell the city's five parking garages is advancing.

City officials have been discussing the idea with representatives of Scranton Parking Authority's bondholders, who took control of that agency after city council allowed the parking authority to default in 2012.

The city guarantees authority debt and has had to provide bailouts since 2012. Mayor Bill Courtright's recovery plan, issued July 2 by consultant Henry Amoroso, recommended immediately selling the five garages and using the estimated $22 million raised to reduce the parking authority's debt from $53 million to $31 million. The city then would assume any remaining parking debt and refinance it as part of a larger refinancing of other city long-term debt.

During a council caucus on July 24, council President Bob McGoff said developments are moving quickly. Discussions focus on a "possible monetization of, or sale of, or lease -- or something -- dealing with the garages. So, we might be seeing something really as early as September," Mr. McGoff said. "Some type of resolution of these issues might come before us."

Mr. Courtright said in an interview last week, "We've been concentrating on moving as fast as we could with the parking authority" issue.

Bondholders and their representatives -- the trustee, insurers and the court-appointed receiver, Mike Washo -- have controlled the authority garages since the 2012 default and would have to agree to any sale of authority assets. While the Amoroso report states the estimated $22 million in sale proceeds would defray parking authority debt from $53 million to $31 million, Mr. Washo said the debt principal actually is $48 million. With any transaction, bond insurers will make sure bondholders are protected and that bonds are paid.

"The city's the backstop for this debt," Mr. Washo said. "We're having conversations. They could prove to be productive."

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Contact the writer:

jlockwood@timesshamrock.com, @jlockwoodTT on Twitter

___

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Source: Times-Tribune (Scranton, PA)


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