Unrated Scranton, Pa., on Friday announced a public-private partnership under which 501(c)(3) nonprofit National Development Council will manage the distressed city's parking system.
The agreement, which will include city parking garages, street meters and the Marketplace at Steamtown mall, is expected to relieve the city of $53 million of parking authority debt, Mayor Bill Courtright said at a City Hall news conference.
Courtright said the city garages also need $40 million in renovations.
Officials did not specify bond transactions, capital investments and property transfers necessary to close the deal.
The arrangement, said the mayor, "will end both a costly receivership of the Scranton Parking Authority and one of the city's principal financial liabilities, and make an unmatched investment to supercharge downtown Scranton's already flourishing turnaround."
Scranton, the 76,000-population seat of Lackawanna County in northeast Pennsylvania, has been working to restore credibility in the capital markets ever since the City Council voted in June 2012 to default on a $1 million bond payment to the parking authority amid a political dispute.
The city since repaid the $1 million, but the parking authority stranded debt remained, as did the stain on municipal credit.
Its last bond rating, a junk-level BB-minus from Standard & Poor's, was withdrawn at Scranton's request in 2011.
Scranton is also working to shore up its severe unfunded pension liability. Its non-uniformed pension plan was 23% funded as of January 2013. Firefighter and police plans were 16.7% and 28.8% funded, respectively. Pew Charitable Trusts considers 80% an acceptable threshold.
In late March, the city agreed to sell its wastewater assets for roughly $195 million to Pennsylvania American Water Co. The parties hope to close the deal by the end of October.
