"It's a risk we didn't want to take," said Councilman Brian J. O'Neill, the lead Republican on the committee, referring to the threatened legal challenge. O'Neill said he was confident that the state oversight board would accept Council's action.
But Ronald G. Henry, executive director of the Pennsylvania Intergovernmental Cooperation Authority (PICA), said board members were upset by the move. Reached at home last night, Henry added that the board might refuse to act as the city's borrowing agent unless Council overturns last night's action.
Sources close to PICA said the board might decide to suspend its efforts to help solve the city's financial dilemma until a new mayor and Council take office in January. If it does, the city would be forced to borrow on its own at much higher interest rates.
The dramatic developments came as the Council panel met in an unusual weekend session to vote on an agreement between the city and PICA that would define the powers of the oversight board. Such an agreement is required by state law before the board can begin borrowing the tens of millions of dollars necessary to keep the city operating.
Most city officials hope to have the agreement in place within the next 10 days to meet PICA's timetable to begin borrowing the money the city says it needs to continue operating. Goode administration officials maintain that the city may run out of money within weeks without PICA's assistance.
Apparently concerned that the city is running out of time, the administration is trying on its own to borrow $90 million from local universities and hospitals.
The Council committee's hopes for a smooth meeting unraveled early yesterday when more than 200 angry city workers jammed into Council chambers to oppose the proposal, which would give PICA unprecedented influence over city financial decisions.
Fueling labor's opposition was a provision of the agreement that would
