pennlive.com Laura Vecsey: Harrisburg incinerator audit shows party's over January 22, 2012 at 1:46 PM BY LAURA VECSEY
Pennsylvania’s scrappy little capital city of Harrisburg might have served as a national punch line for municipal fiscal mismanagement, and a full-court, worldwide press might have been mounted to make Harrisburg pay for the fraud of its trusted rulers and advisers, but a new day has dawned.
After years of trying to establish the truth about the city’s debt crisis in the face of evasions by the debt creators and co-conspirators, it’s ironic that the same pot of money that former Mayor Stephen R. Reed used to buy Wild West artifacts, in the end, supplied the money for a forensic audit of the doomed, and damned, incinerator project.
The truth has been established only because new sheriffs on City Council and at the Harrisburg Authority — the post-Reed outraged who weren’t invested in a cover-up — insisted that recovered dollars from Reed’s days of delusion be used to get answers. Add to that the bald and telling testimony from the federal trial about the CIT loan and an analysis by attorney Mark Schwarz and there’s finally a basis for making sure others pay. This triumvirate of evidence and analysis finally confirms what everyone has long suspected to be the truth: The incinerator financing was a sophisticated financial crime.
It will no longer be enough for those involved and who claimed to legal responsibility to shrug their shoulders and utter the phrase they think absolves them from willful deceit and criminal conspiracy: “Hey, sometimes public projects fail.” Of course they fail. They fail when people in charge flaunt every rule, every legal standard, every shred of common sense or civic decency. The audit, released last week, did what no public law enforcement agency had the guts or will to undertake.
It presented evidence that the incinerator financing was a criminal scheme created by elected and appointed officials who used the incinerator as a cash cow. It was a terrible scheme papered over by scores of lawyers and other “professionals” who were paid handsomely to make sure the house of cards was never exposed. It was such a compelling scheme because SWAP after fee-generating SWAP, money flowed from the incinerator to those creative souls who knew how to circumvent the law — and reality — to generate their payoff.
Worse, and more dangerous, was the way in which officials and “professionals” for years insisted that this massive debt that they guaranteed by the taxing authority of Harrisburg and Dauphin County would indeed be pinned on the backs of taxpayers. Their mantra? That Harrisburg was not allowed to default on its loans. The city would be made to pay. Bondholders would be made whole, no matter that fraud was committed.
The question not answered is what compelled Dauphin County to sign off on such a ridiculous incinerator plan? But given the evidence released in the 133-page audit and gathered from the CIT trial, it is now far less likely that creditors and co-conspirators will get away with this scam. It’s less likely now that anyone, including the state-appointed receiver for Harrisburg, would dare to force Harrisburg alone to make bondholders whole. With 460 footnotes backed by 8,000 pages of data, this audit is at the least an introduction to the story of the incinerator crime. And it is just that: A start. There are many eye-popping revelations that could serve as a well-founded starting point for deeper investigation.
For instance, what about an exchange documented that shows how key players in the Reed administration and the former Harrisburg Authority board discussed the incinerator approval in ways that could amount to evidence of conflict-of-interest, payoffs and/or bribery, vote-buying? In one email exchange alone, former Harrisburg Authority board member Fred Clark (Freddie) and his company, Reynolds Construction, who got a $1 million contract as part of the incinerator deal, makes it clear how “Freddie” would deliver votes for approval of the project. Likewise, the email confirms that in order to assuage concern among City Council members, part of the money the city would get for guaranteeing the bonds would fund a new account to allow council members to give away “walking around money” to constituents and organizations.
Did someone suggest there were no smoking guns in this audit? What about the potential that instead of listening to God about how to vote, as she said, former City Council President Linda Thompson might have been persuaded to vote for the project for other reasons? Why did Thompson, who was first elected as part of “The Reed Team,” never release information about donors to her nonprofit group Loveship? Where did contributions for that nonprofit come from? Thompson, who stalled for more than two years in dealing with the city’s urgent debt crisis, has yet to do so.
And how, exactly, did the state Department of Community and Economic Development agree to certify that the incinerator bond debt was self-liquidating? And why were 25 “professionals” associated with the incinerator bonding notified in April 2003 that if the incinerator project was delayed or over budget, its debt would not be self-liquidating? Seems clear that the project was destined to fail.
It’s also interesting to note that in Harrisburg, where state lawmakers last year jammed through legislation that took away the city’s right to file for Chapter 9 protection in federal court, some of those very lawmakers served as private attorneys at firms that represented loan underwriters for the incinerator loans.
In other words: Everyone knew the incinerator would not be able to generate revenues to repay the loans.
But now with the forensic audit in hand, the state-appointed receiver for Harrisburg, David Unkovic, can press for the steep concessions he has said are necessary and warranted. If these creditors continue to play hardball, then Harrisburg has ammunition to go back with new demands to the “professionals” who were warned to preserve all their documents pertaining to the incinerator project: Eckert Seamans, Obermeyer, PFM, RBC and AGM. If these firms that made millions on Harrisburg’s plundering are unwilling to cover more than half of the debt, then City Council and the Harrisburg Authority will simply wait until July 1.
The fiscal year in which the city is barred from filing Chapter 9 ends on June 30. By then, it will be clear how far Gov. Tom Corbett, the former prosecutor, will allow Unkovic to go against the biggest, most politically connected players in the state.
Corbett has surprised some of these players with the appointment of Unkovic, but the real measure will come when Unkovic releases the recovery plan on Feb. 6 and when City Council and the Harrisburg Authority establish and declare their rights and remedies given the evidence. Finally, Harrisburg has the truth on its side.
Maybe those of us who were sickened over the Iraq war and the the Bush/Cheney administration should have been more unruly.
To think that some of us Americans waited painfully and patiently for the George W Bush/Dick Cheney error to end, and now this: a government shutdown because of the zealot-like righteousness of a few religiously-inspired martyrs in Congress who allege that they are champions of the US constitution.
That's the biggest thing that galls me – and makes me scared that we aren't far from lawlessness and mayhem, especially when you add in the voting rights setbacks that threaten future elections, local and national.
People joke about the Panda Cam at the National Zoo in Washington going dark, but what about the Federal Trade Commission investigators who aren't hunting down Russian hackers this week, courtesy of Senator Ted Cruz and House Speaker John Boehner's shutdown?
The practical mess of the shutdown is not funny, pandas and all. But what's really not funny is the perilous fight we have on our hands. Can we restore any integrity and faith in our own government? How can we, especially since Fox News has so successfully enlisted average Americans to rage against Barack Obama and the Affordable Care Act as if they were fighting the Nazis.
How did this become progressives' war?
We could have tolerated conservatism's debate on smaller government. We get it. Government is a beast. It needs to be checked. A social safety net can create bloat and abuses. Let's debate each other about where to draw the line. Or, in the case of the Affordable Care Act, figure out what's working and what's not and fix it, constructively, so that health care safety and costs can be attained and leveled.
But to deliberately smash government, to vilify it and persecute it and kick it to the curb like one of those welfare takers Mitt Romney was never going to win over during his failed presidential run? That's another story. That's a rabid faction of Congress that can't be brought back to the fold. That's a faction of Congress that has teetered outside the bounds of rational discourse, fueled, likely, by copious amounts of booze and backslapping and safe pockets of gerrymandering that have created two Americas, one red and mostly Caucasian, the other blue and colorful, diverse.
What's hard for most of us to understand is this: Barack Obama rode to the presidency in large part because of the backlash against Iraq war and the neo-con lies perpetrated by the Bush/Cheney administration. A terrorist attack on US soil had fed an unchecked frenzy for an unlawful and unfunded war, yet by 2004, when evidence was in about the lies and abuse of power by the Bush administration, many of us were weathering a sense of almost unfathomable betrayal.
You would have imagined that under those circumstances, the seeds were sewn for lawless uprisings; for discontent (and worse) to have undermined our sense of allegiance to our country 'tis of thee. Grieving as some US citizens were during this time, we still found a way to use our democratic process to restore our ideals, to make change, but to do so within the context and confines of our constitutional system.
For those of us who opposed the war in Iraq; who grew disgusted with the cronyism and incompetence of the Bush administration (Hurricane Katrina response; Wall Street's implosion; the bank bailout), we waited out the policymakers who we thought were steering us in the wrong direction. We amassed the votes necessary to make a change.
Maybe those of us who were sickened over the Iraq war and the bleeding of money to Halliburton and the faux conservatism of the Bush/Cheney administration should have been more unruly. Now a US law rightfully enacted and justly upheld by the Supreme Court is being held hostage for renegotiation by obstructionists as if the Affordable Care Act was just an idea, a bill, and not a law.
In this instance, we are sure that something has gone very wrong inside our own elected government. Some of us are very alarmed, although maybe not surprised. This is what you get in an America where congressional districts are drawn in configurations meant largely to protect Republicans. This is what you get when the Citizens United Supreme Court ruling allows unlimited mystery money to flow into political action committees to elect candidates who are unanswerable to constituents but owned by corporations.
But there's a major difference between those who voted for Obama and "Obamacare" and those who have shutdown the federal government: while we licked our wounds, and watched as Supreme-Court-ordered loser Al Gore grew that beard and gut, we may have despaired, but we also figured that our way out of the mess was to work the system we have.
We waited and organized and were ready to show that the country was comprised of a more diverse population; that we did not want wars of choice; that we needed to get back to the business of reinventing our economy, including the biggest drain on our fiscal well-being: sky-rocketing healthcare costs.
We got change by using the system as it was intended. We waited and amassed the votes for change, which wound up being in the form of Barack Obama. Like a mirror, it is said, Obama reflects whatever anyone who's looking at him wants to see. For us, he was change. For the government shutdowners who have sprayed the stink of anarchy on us all, Obama is the illegitimate son of big government and a panderer to all the takers and all the food stamp users and all the uninsured who put him in the White House. Twice.
Does red sock on Schilling's foot pass the blood test? Laura Vecsey October 25, 2004 BOSTON -- Now that Curt Schilling's postseason apparently is over after last night's start, maybe we can reflect on what is certain to become a legendary October performance.
But some of us have been fixated on one distinct possibility: What if it wasn't blood on his sock during his Game 6 performance in the American League Championship Series? Does that diminish the image of Schilling as Curse Killer, as the hired gun with a World Series ring and Most Valuable Player trophy from Arizona who came east to do exactly what he said he'd do: beat the Yankees, which Red Sox Nation insists is the same thing as killing the curse?
Maybe it wasn't blood. Maybe it was antiseptic or a few errant drops of anesthetic we saw. Does blood stay bright red through seven innings, exposed to air?
Does blood come out of an area that, from distant observation of Schilling's naked foot, doesn't seem to be irritated to that degree, despite the sutures holding the tendon in place?
"It could have a little blood mixed in there, but we'll have to check it out with the trainer," Red Sox director of public information Glenn Geffner said, willing to entertain the possibility that blood wasn't the only substance that could have turned up a splotch on Schilling's sock.
Maybe Schilling was willing to let it be interpreted as such, because what's better than a great moment amplified to the maximum level of instant legend?
We've seen these kinds of things before on exactly this kind of stage.
Hall of Famers and great competitors doing whatever it takes to not only guarantee victory, but also push the moment toward immortality.
We give you Joe Namath and Super Bowl III.
We give you Michael Jordan, playing through a flu, his father's murder, gambling accusations, retirements, comebacks, divorce charges, lawsuits by former girlfriends and still winning NBA championships.
At the 2002 Winter Games in Salt Lake City, after the Canadian Olympic hockey team won the gold medal, there was Wayne Gretzky, impish grin unleashed, digging at the rink ice.
From beneath the surface, the Great One chipped out a Canadian coin. It was a looney, which Gretzky said he had buried there to ensure good luck for the Canadians.
We all believed it. But what if Gretzky had made it up?
There's a little bit of Hollywood, a lot of Madison Avenue in these big-time sports stars. Schilling included. It sure seems Schilling is starring in this role as baseball savior during this postseason.
Schilling is absolutely eating up these moments on the world's biggest sporting stage. He has everyone convinced.
On the front door of the Thai Dish restaurant on Newberry Street, three miles from Fenway, there's no mistaking why Bostonians believe the Red Sox are playing in the World Series.
Curt Killed the Curse.
That's what it says on the hand-printed sign.
If the Red Sox's unofficial Thailand Fan Club can boast Schilling is the reason the Sox are alive, it's pretty clear Schilling's performance in Game 6 of the ALCS has immediately become something way, way beyond the usual stuff of epic, mythic or even urban legend.
But what if that wasn't blood on Schilling's sock?
When Schilling was asked about the red splotch on his sock after his 4-2 win over the Yankees last Tuesday, he said it might be a little bit of blood.
In the frenzy of the historic moments that produced the Red Sox's first ALCS victory since 1986, few stopped to consider that maybe Schilling wasn't willing to burst the image of a bloody sock by denying his sutures were bleeding.
And now no one cares, including his teammates.
Kevin Millar was the emotional king of Red Sox Nation for their first foray against the Yankees in the 2003 ALCS. His Cowboy Up antics galvanized the team and got the Red Sox to all row in one direction, with a ton of energy and heart.
But Millar will not second-guess Schilling: "Whatever he can do to get to the mound, he'll do."
Nor will catcher Jason Varitek.
Asked whether he thought Schilling was enjoying his self-made image as deified deliverer from despair for Red Sox Nation, Varitek smiled.
"Oh, I don't know. I'll say one thing: He's a great teammate. He'll do whatever it takes for us to win," Varitek said.
Does that include allowing the myth of the blood-stained sock to overtake the real possibility that it wasn't blood?
"Let's just say that he's a good teammate, a valuable asset, not just as a pitcher, but as a teammate," Varitek said.
And sometimes, the best teammates will take extraordinary measures to make sure the world understands just exactly what an amazing thing has just been accomplished.
Call it embellishment. Call it poetic license. Call it a great sportsman amplifying his own legend.