HARRISBURG, Pa. (WHTM) — It’s clearly not the only reason why Harrisburg’s downtown is suffering, but $4-per-hour street parking is just as clearly a major one.
Downtown business owners said as much to Gov. Josh Shapiro (D) and Rick Siger, Pennsylvania’s secretary of community and economic development, during a tour last week of downtown businesses.
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“Our team is looking really closely at the parking situation now as part of, really, an all-of-the-above-look at what it’s going to take to help downtown Harrisburg move forward,” Siger said.
But what can the state really do about the “total mess,” as Harrisburg’s treasurer Dan Miller (D) called it in an interview Monday, that is Harrisburg’s public parking situation?
First, recall what caused the mess: Harrisburg, which was insolvent, borrowed hundreds of millions of dollars in 2013, secured by future parking system revenue. The city transferred the system to a private operator.
With a need to cover not only parking-related costs, such as garage maintenance, but also pay huge debts unrelated to parking, Harrisburg’s hourly parking rate of $4 per hour is similar to rates in busy parts of large cities like Philadelphia and Pittsburgh — and even some parts of New York City — rather than a nearby city like York, which retains control of its parking system and charges $1.50 per hour.
Did Harrisburg have a better option in 2013? Can it extricate itself from the situation now? The answer to both questions is: yes and no.
City leaders in 2013 wanted to file for bankruptcy, which could have wiped out a lot of the debt.
At about the same time, “Detroit went bankrupt and ended up paying about 25 cents on the dollar” for its obligations, Miller said, meaning much of the pain was borne by stakeholders outside the city, such as out-of-town banks.
But Pennsylvania, then led by Gov. Tom Corbett (R), didn’t allow Harrisburg to file for bankruptcy, meaning far more of the pain of the insolvency would be borne by city residents and businesses.
“In a sense, bankruptcy is bad,” Miller said. “I don’t want to go bankrupt. You don’t want to go bankrupt.” But, he said, it can be the best way “to reboot and start over.”
Detroit “did it very successfully,” Miller said. “They’re up and coming. And look at Harrisburg.”
Harrisburg isn’t the only city to find itself in a mess like this one. To understand how difficult it is to get out, look to a city even larger than Detroit: Chicago, which — in its own fiscal mess — sold its parking system for $1.15 billion in 2008 but left residents and visitors paying as much as $7 per hour today for street parking.
As recently as last month, Chicago’s mayor was said to be looking for a way to buy back the system but — criticized for considering the one thing that could be an even worse deal than the original one — later said the idea was off the table.
Chicago could theoretically buy back its system — for a $3 billion, according to one estimate. Similarly, Harrisburg theoretically could regain control of its system (which in its case it technically mortgaged rather than sold) for perhaps the $362 million in parking authority-related debt it owed at the end of 2024, Miller said, citing Park Harrisburg financial statements.
But there’s a reason the cities are in the situations they’re in: Chicago doesn’t have $3 billion, and Harrisburg doesn’t have $362 million.
In light of Siger’s comment about looking into how the state might be able to help, abc27 News has contacted the Department of Community and Economic Development to ask what form that help could take.
“I think the state could help in, number one, getting state workers back downtown,” Miller said.
Fewer than half of Dauphin County-based state workers spend at least three days a week at the office. “We’ve ordered more state workers to come back on a more regular basis,” Shapiro said last week during the downtown tour.
Expensive hourly parking has created several vicious cycles. For one, it discourages downtown visitors, so total parking revenue isn’t as much as it would be if the name number of cars continued parking but paying more. It’s at least part of the reason why businesses are struggling and closing.
That, in turn — Miller explained — means those businesses aren’t paying what are known as mercantile taxes on what they sell. Then the owners of emptying and thus less valuable commercial buildings appeal for lower assessed values, meaning less property tax revenue.
With its parking-related debt, Harrisburg — Miller explained — is not only failing to make up ground. It continues losing more ground because it hasn’t paid the interest on its debt so far. That’ll all come due in the future, he said, a financial tactic known as accreted interest.
“They always sort of throw [accreted interest] in because it can make the numbers work,” Miller said of financiers who design deals like the one Harrisburg did in 2013. “Otherwise, the project won’t work. And if the project doesn’t work, then you shouldn’t do it.”
“In my opinion, accreted interest should never be allowed for a government entity,” Miller said.
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date: 2026-02-10 05:08:00
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