Michigan To Appoint Emergency Fiscal Manager For Detroit

English: City seal of Detroit, Michigan.

English: City seal of Detroit, Michigan. (Photo credit: Wikipedia)

DETROIT — Gov. Rick Snyder of Michigan announced on Friday that the city of Detroit is so snarled in financial woes that the state must appoint an emergency manager to lead it out of disaster.

“There is probably no city that is more financially challenged in the entire United States.  If you look at the quality of services for citizens it’s ranked among the worst.  So we went from the top to the bottom over the last 50 or 60 years,” Mr. Snyder told Detroiters in a town-hall-style meeting that was broadcast live on local television stations across the city.

“It’s time to say we should stop going downhill,” he said.  “There have been many good people that have had many plans, many attempts to turn this around, they haven’t worked.  The way I view it, today is a day to call all hands on deck.”

The state-appointed manager, who could be selected later this month, would ultimately wield powers aimed at swiftly turning around the municipal government’s dire circumstances — powers to cut city spending, change contracts with labor unions, merge or eliminate city departments, urge the sale of city assets and even, if all else failed, to recommend bankruptcy proceedings.

Read more:  http://www.nytimes.com/2013/03/02/us/michigan-appoints-emergency-manager-for-detroit.html?hp&_r=0

American, US Airways Announce $11 Billion Merger

London Heathrow Airport (LHR/EGLL), London Bor...

London Heathrow Airport (LHR/EGLL), London Borough of Hillingdon, London, United Kingdom (Photo credit: Wikipedia)

DALLAS — American Airlines and US Airways have agreed to merge in an $11 billion deal that would create the world’s biggest airline.

The combined carrier will be called American Airlines but run by US Airways CEO Doug Parker.

The boards of the two airlines unanimously approved the deal late Wednesday, and the companies announced the agreement early Thursday.

The merger would reduce the number of major U.S. airlines to four: the new American, United, Delta and Southwest.

Read more: http://www.post-gazette.com/stories/business/news/american-airlines-us-airways-to-merge-675368/#ixzz2KuSpPCrN

Hostess, Maker Of Twinkies, To Close

Hostess Brands Inc. says it’s going out of business after striking workers across the country crippled its ability to make its Twinkies, Ding Dongs, Wonder Bread and other snacks.

The company had warned employees that it would file a motion with U.S. Bankruptcy Court today seeking permission to shutter its operations and sell assets if plants didn’t resume normal operations by a Thursday evening deadline.

The closing would mean the loss of about 18,500 jobs.

“Many people have worked incredibly long and hard to keep this from happening, but now Hostess Brands has no other alternative than to begin the process of winding down and preparing for the sale of our iconic brands,” CEO Gregory Rayburn said in a letter to employees posted on the company website.

Read more:  http://readingeagle.com/article.aspx?id=428558

West Penn Allegheny Cancels Highmark Affiliation Agreement

English: Highmark Place from PNC Park in Pitts...

English: Highmark Place from PNC Park in Pittsburgh, taken 2008 showing the new Highmark branding atop. (Photo credit: Wikipedia)

Saying that Highmark Inc. wanted it to restructure through bankruptcy, West Penn Allegheny Health System canceled the $475 million deal under which the insurer planned to acquire WPAHS.

WPAHS board chairman Jack Isherwood said in a written statement this morning that he considers bankruptcy a poor option for the health system’s employees and customers.

“To us, bankruptcy is not the first option, it’s the last option,” he said.

WPAHS is actively looking for new partners and is willing to consider all types of companies — another insurer, nonprofit, for-profit.

Senior management will remain in place, Mr. Isherwood said.

Ritz Camera To Liquidate After 94 Years

Ritz Camera logo

Ritz Camera logo (Photo credit: Wikipedia)

Ritz Camera & Image LLC plans to go out of business after 94 years as it failed in a bankruptcy auction to find a buyer to keep the largest U.S. specialty camera retail chain open.

U.S. Bankruptcy Judge Kevin Gross in Wilmington, Del., approved a plan Monday to turn over most of Ritz’s assets to liquidation specialists Gordon Brothers Retail Partners LLC and Hilco Merchant Resources LLC, the high bidders at a Sept. 6 auction, court records show.

“The debtors received no bid to purchase substantially all of the debtors’ business and assets as a going concern,” and believes a sale to the liquidators “will result in the realization of the maximum amount possible,” Chief Restructuring Officer Marc Weinsweig said in a court filing.

Read more: http://www.mcall.com/business/chi-ritz-camera-to-liquidate-after-94-years-20120910,0,5250806.story

Unfinished West Reading Project Leaves Residents With Dirt, Weeds, Fading Hopes

Every year on the anniversary of her move-in date, Holly Zdravecki picks up the phone to call West Reading Borough Hall.

She bought the first town house in the promising Villas at West Reading development off Tulpehocken Avenue on March 16, 2008.

But Zdravecki still doesn’t have a paved street in front of her home.

Instead, mounds of dirt covered with grass and weeds adorn the lot at the entrance to the development. Six large concrete foundations with utility lines poking through the ground make up the north side of the complex.

Read more: http://readingeagle.com/article.aspx?id=379000

AFA Foods In King Of Prussia Declares Bankruptcy

Ground beef in industrial grinder

Ground beef in industrial grinder (Photo credit: Wikipedia)

NEW YORK (AP) – Ground beef processor AFA Foods said Monday that it is filing for Chapter 11 bankruptcy protection and selling its assets after the public outcry over the beef filler known as “pink slime” derailed its efforts to save its already struggling business.

A spokesman said in an email that the company does not rely on boneless lean beef trimmings and uses it only based on customer specifications. But he said the controversy over the ammonia-treated meat filler has dramatically reduced demand for all ground beef products.

AFA Foods, based in King of Prussia, Pa., processes more than 500 million pounds of ground beef products a year. It distributes to retailers including Wal-Mart Stores Inc., Safeway Inc. and BJ’s Wholesale Club. Fast-food chain customers include Burger King, Jack in the Box and Wendy’s.

Read more: http://business-news.thestreet.com/the-times-herald/story/afa-foods-king-prussia-declares-bankruptcy/1

Harrisburg Leaders Believe Bankruptcy Is Inevitable For City

Map of Pennsylvania highlighting Dauphin County

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Editor’s note:  How very sad that the capital city of this great Commonwealth has deteriorated to this extent!

The Patriot-News Editorial Board met Thursday with City Controller Dan Miller, Council President Wanda Williams and City Treasurer John Campbell.  Below is an excerpt of the conversation.

Q: Where do things stand in the city now?
Dan Miller: We’re going into bankruptcy.  The question is will we have the assets or won’t we have the assets [when we do].  Just because we adopt a plan, that’s not going to solve the problem.  I think [receiver] David Unkovic knows the same thing.

Wanda Williams: I had an opportunity to talk to Jefferson County, Ala., officials last weekend.  They tried to derive a plan there similar to Unkovic’s, but the people were up in arms and they said no, we are not going to allow you to sell our assets.  What you’re going to do is sell our assets and we’re going to be left with nothing, and we’ve been telling Unkovic that.  Where do you derive the revenue from after you sell all our assets?  Now Jefferson County has filed bankruptcy, and the judge is making that determination.  Their assets are safe for the time being. I see this as a ploy — Gov. Corbett has asked [Unkovic] to come in and do a plan, but in the interim, we’re going to be selling assets and filing for bankruptcy.

 Q: How significant was the city’s general obligation default on March 15?
Miller: I suspect we’re not paying any more debt for the rest of the year. I’m not the decision maker, but if you’re not going to pay it now, you’re not going to pay it anymore.  Unkovic is projecting a $9.5 million deficit.  I’m calculating $15 million.  We’re both acknowledging it’s a big deficit for this year.  Our general debt service is about $11 million a year.  Even if you sell the assets, it’s not going to impact the budget. We’re out of money.

Read more:http://www.pennlive.com/editorials/index.ssf/2012/03/harrisburg_leaders_believe_ban.html

Fast Eddie Part Of Group Looking To Buy Philadelphia Inquirer

The Philadelphia Inquirer-Daily News Building ...

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Looks like Fast Eddie’s back in the saddle again!

PHILADELPHIA (AP) — Former Gov. Ed Rendell and Philadelphia Flyers owner Ed Snider are leading a “civic-minded” effort to buy Philadelphia’s two largest newspapers, Rendell said Friday.

The six-person group submitted a non-binding “letter of interest” Thursday in Philadelphia Media Network, which operates The Philadelphia Inquirer and Philadelphia Daily News.

News reports surfaced this week that two hedge funds with major stakes in the company want to sell. The firms, Alden Global Capital and Angelo Gordon, had led the creditors’ $139 million takeover of the company at a September 2010 bankruptcy auction.

Rendell could not confirm their intentions, but said a third party has been reaching out to potential investors in recent weeks. The media company would be bought outright, he said.

Read more: http://www.dailylocal.com/articles/2012/02/04/news/doc4f2d48b30ba13550941899.txt

Blockbuster Closing More Stores

Blockbuster Video plans to shutter all but one of its remaining Lehigh Valley stores in the coming days, according to several sources.

The beleaguered movie rental chain plans to cease rentals as early as Monday, Dec. 26, at stores at 2221 Lehigh St., Allentown; 2918 William Penn Highway, Palmer Township; and 756 Memorial Parkway, Phillipsburg, according to employees who answered the store phones Wednesday.

Liquidations are planned to start next week, according to the clerks.

Read more: http://www.mcall.com/news/breaking/mc-allentown-blockbuster-closing-more-stores-story-20111221,0,4779144.story

Harrisburg Under Control Of State Appointed Receiver

David Unkovic, most recently chief counsel of the state’s Department of Community and Economic Development, was named by Gov. Tom Corbett to lead Harrisburg quickly out of financial distress. He will be assisted by the Washington, D.C.-based law firm of McKenna Long & Aldridge.

At a press conference, Unkovic deflected concerns about his past, including 23 years at the firm of Saul Ewing, which represents Assured Guaranty, the largest insurer of Harrisburg incinerator bonds.  He’s also worked for other firms that have ties to the incinerator debacle, including Public Finance Management and RBC Capital Markets…

Read the rest of the story… http://www.theburgnews.com/Index.html

Crystal Cathedral Sold To Roman Catholic Diocese

The Hour of Power

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The glittering monument to Robert H. Schuller‘s ministry is being sold to the Roman Catholic Diocese of Orange.  The Crystal Cathedral filed for bankruptcy last year and is being purchased by the diocese for $57.5 million.

After Robert H. Schuller retired in 2006, his son (Robert A.) tried to follow in his famous father’s footsteps as Senior Pastor.  However, in 2008 Robert A. Schuller was removed as Senior Pastor by his father.  Robert H. then made his daughter Sheila Interim Senior Pastor in 2009.  Sheila became the permanent Senior Pastor in 2010.  Three months after her elevation to permanent Senior Pastor the church filed for bankruptcy.  During this transition period the church lost thousands of members and millions of dollars in revenue, causing layoffs, salary cuts and finally bankruptcy.

Chapman University had offered to buy the 40-acre complex and allow the congregants to continue worshipping in the cathedral.  However, selling to the Roman Catholic Diocese of Orange will guarantee that the Crystal Cathedral will continue to be used as a house of worship.  The diocese has plans to make the Crystal Cathedral the center for the Catholic community in Orange County.

In three years, the congregation at the Crystal Cathedral will need to move.  There are some who fear the move will be too much for the remaining congregation.  There is also concern that the Hour of Power television program viewers might disappear if the show is no longer broadcast from the Crystal Cathedral.  70% of the revenue for the Crystal Cathedral comes from Hour of Power viewers.

At one time, the Crystal Cathedral had 10,000 local members.  Coincidentally, there are 10,000 panes of glass that make up the famous church, which was dedicated in 1980.

America’s Disappearing Restaurant Chains

There is a school of thought that says the restaurant business is always a good business because people need to eat. A glance at the sales of many of America’s largest restaurant chains over the past decade quickly dispels that myth.

Using data provided by food industry research firm Technomic, 24/7 Wall St. has looked at the 10 restaurant chains with the greatest decline is sales from 2001 to 2010. In every case, sales have fallen 60% or more…

To find out who the 10 chains are, click here: http://money.msn.com/business-news/latest.aspx?post=3b851ddb-d3b2-4867-92a3-07abc068523b

Harrisburg City Council Rejects Act 47 Plan And Mayor’s Plan – State Takeover Likely

Harrisburg City Council rejected the Act 47 plan, and now they have rejected Mayor Linda Thompson’s plan one last time.  Critics say the mayor’s plan is basically the same plan as presented by the Act 47 team.

Rejecting the mayoral plan means the original plan will end up being enforced by the Commonwealth.  Council is delaying the inevitable.  However, denying the plan gives naysayers the ability to distance themselves from the plan should it go badly.  This amounts to a CYA move for the no votes on council and the ability to come back and say “I told you so!” later.

Governor Corbett says he will sign legislation to appoint an oversight board to enforce the state recommended financial recovery plan.  Harrisburg is $310 million dollars in debt from a failed retrofit of the city’s incinerator.

Borders Going Out Of Business!!!!

Borders' current flagship store in Downtown An...

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The long decline of bookseller Borders Group is finally coming to an end.  It was announced Monday, July 18th, that the chain’s remaining 400 stores will all close and nearly 11,000 employees will lose their jobs.

The sale of Borders to Najafi Companies fell through after creditors objected to part of the $435 million deal.  Books-A-Million, the nation’s third-largest book retailer, may be interested in purchasing a few of the locations (30).

Borders was the second-largest bookstore chain in the U.S.

Law Firm Advises Harrisburg City Council Not To Pursue Bankruptcy

Recreation of the flag of the city of Harrisbu...

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Cravath, Swaine & Moore has advised Harrisburg City Council, via a two hundred page document, not to pursue bankruptcy at this time.  Rather the city should stay the course with Act 47 and try to negotiate with stakeholders.

Harrisburg entered Act 47 after the city amassed a $288 million debt from retrofitting its incinerator.  This has nearly bankrupted Pennsylvania’s capital city and put a strain on Dauphin County as well.  The county became involved when Harrisburg City and Authority were unable to make a loan payment last year and were on the verge of default.

Coventry Mall Borders Express Closing!!

Borders' current flagship store in Downtown An...

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For whatever reason, the Coventry Mall Borders Express store is not listed on the Pennsylvania store closing list.  However, after walking around Coventry Mall this morning, the Borders Express store has a final closing sale sign in the window.  It says this location only, which I thought was rather odd since Borders is closing hundreds of stores nationwide.

So there is your alert Pottstown area shoppers.  Borders Express at Coventry mall is closing.  I believe the sign said up to 75% off.  If you want to get some cheap books, you better head over soon!  It will not be open much longer.

Borders Adds 26 More Stores To Chapter 11 Closing List

Here is the list of Borders stores closing in Pennsylvania taken from their website.  The Philadelphia store was just added Thursday, March 17th.

Camp Hill, PA Capital City Commons 3515 Gettysburg Road
Erie, PA Millcreek Pavilion 2088A Interchange Rd
King of Prussia, PA The Pavilion at King of Prussia 650 Mall Blvd.
Langhome, PA Marketplace at Oxford Valley 2343 E. Lincoln Highway
Monroeville, PA                                                                                                      200 Mall Blvd
Philadelphia, PA (closing by late May 2011)                             1 South Broad, Suite 100
Pittsburgh, PA Crossgates Shopping Center 1775 North Highland Road
Pittsburgh, PA Eastside Shopping Center 5986 Penn Circles South, Ste 101
Reading, PA Woodmill Commons 1075 Woodland Rd
Whitehall, PA Whitehall Mall 1937 Whitehall Mall
 

For a complete list of store closures nationwide:

http://media.bordersstores.com/pdf/Borders_Reorg_Closure_Listupdated3-17.pdf

Borders announced July 18th that it was going out of business and closing their remaining 400 stores after finding a buyer fell through.

Borders Bookstores File For Chapter 11 Bankruptcy Protection

Borders' current flagship store in Downtown An...

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Borders filed for Chapter 11 bankruptcy protection at the U.S. Bankruptcy Court in New York on Wednesday.

Borders is hemorrhaging cash at the rate of $2 million dollars a day from underperforming stores.  Borders intends to close 200 of its 642 stores nationwide.  The closures will come in the next few weeks.  Clearance sales could start as early as this weekend.

Borders will receive $505 million in debtor-in-possession financing from GE Capital Partners and others to help with the reorganization.  Borders owes over $100 million to various publishers.  Book sales nationwide fell 5 percent in 2010.  Borders controls 14.3 percent of the book selling market.  Barnes & Noble, on the other hand, controls 29.8 percent of the market which is helping them survive the economic downturn.

Borders has been in business since 1971, when it started out with one used bookstore in Ann Arbor, Michigan.  Borders was owned by Kmart Corp. from 1992 until 2006.  Borders committed a fatal error when it opted out of their e-commerce contract with Amazon.com in 2001.  This decision made it possible for Barnes & Noble to eventually double Borders market share.

Harrisburg May Not Make Payroll For City Employees

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A bad situation is getting worse by the minute.  Harrisburg has 557 employees and the payroll is $1.2 million.  Payroll is due next week and the city has $492,000.00 in the bank.

Fast Eddie and Linda Thompson are scrambling to find lenders to cover the payroll gap but lenders are skittish about investing in Harrisburg.  Not just because of the incinerator debt but also because of the fighting between the mayor and council.  There is no clear plan in place to get Harrisburg out of the mess they find themselves in.  There is a lot of rhetoric and finger-pointing but no good solutions seem to be forthcoming.

 Somebody needs to take control of this rapidly deteriorating situation!