Harrisburg mayoral candidate Eric Papenfuse has suggested entering bankruptcy would hand control of the city over to an unelected federal judge, but that’s just not true.
Even in a Chapter 11 bankruptcy for businesses, the judge does not take over operation of the company, notes Widener law professor Juliet Moringiello. In a Chapter 9 filing for municipalities, the powers of the judge are even more limited.
Separating fact from fiction is not always easy as bankruptcy becomes a talking point in the Harrisburg mayoral election.
The Patriot-News has talked to a number of bankruptcy experts, including people involved with the Harrisburg Receiver’s negotiations who spoke on condition of anonymity because they are not authorized to speak on the record about the process.