Scranton gets $6.25M loan to cover city's payroll

Friday, August 31, 2012

A struggling northeastern Pennsylvania city has secured a $6.25 million loan to cover its current payroll and some back wages.

Scranton officials closed Thursday on the loan from Amalgamated Bank.

City Solicitor Paul Kelly tells The Times-Tribune that the money will cover Friday's payroll of $1.1 million.

Kelly says it will also allow payment of $750,000 in back wages. In June, the mayor temporarily slashed the pay of about 400 city workers to minimum wage, saying the city was nearly broke.

Scranton has been cash-strapped for years. Last week, City Council approved a financial recovery plan.

The loan will be repaid with a $2.25 million state aid package and earned-income taxes to be collected in coming months.

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