Mount Carmel authority's loan approval request tabled
MOUNT CARMEL - The Mount Carmel Municipal Authority (MCMA) needs borough council to approve a $1.25 million loan for repairs to the plant, but the council members are saying no until more information is provided.
The loan from UNB Bank, with a 2.29 percent fixed interest rate over 20 years, will cover expenses to fix one of the sewer tanks damaged in the Flood of 2011, and authority members need borough council approval in accordance with requirements set forth in the lease agreement with the borough dated Dec. 27, 1995.
The wastewater treatment plant, located along Route 2034 near Den-Mar Gardens, has been operating with two tanks for 18 months. Each of the three tanks can treat approximately 3 million gallons of wastewater.
Council President Tony Matulewicz said Thursday night the borough only received the request Monday without any further explanation or documents.
"It would be financially irresponsible and ridiculous to vote on this tonight," he said.
Matulewicz said he takes issue with the authority demanding approval for something so large with only four days notice without informing the borough whether rates would increase for the citizens and what would happen if the Federal Emergency Management Agency (FEMA) or Pennsylvania Emergency Management Agency (PEMA) didn't reimburse the authority for the loan.
Based on documents acquired through a Right to Know request, Matulewicz said authority member Joe Swatski, who is also the secretary, knew about the need for a loan in March.
"Now we get an 11th hour emergency?" he said.
Councilman Gary Hixson Jr. said he has not seen any paperwork to show the details of the loan and was unsatisfied with not having a guarantee that ratepayers would not be affected if the state and federal money doesn't come through.
Authority member John Bucanelli, who was present at the meeting to answer council's questions, said it was determined by an outside firm that the damaged was caused by an error during the flood by operations consultant Fran McGovern, an employee with authority engineer Brinjac Engineering, owned by Dave Brinjac, of Harrisburg.
Hixson was doubtful the authority would be reimbursed for the loan if the damage was caused by operator error.
Matulewicz wondered why the authority continued to employ the engineering company after this and other errors have happened over the years.
"This guy's name is on each of these things. It seems like there's so many problems, and the common thread is Brinjac (Engineering)," he said. "And he's still there."
Vice President Leroy "Chico" Moser said he doesn't fault Bucanelli, but he blames the engineer, who should know the proper procedures.
MCMA Chairman Lawrence Czeponis Sr., who was not at the meeting, said he doesn't understand council's hesitation because council only has to guarantee the loan and no money from the borough taxpayers would be used in the approval.
The borough, as per every financial situation with the MCMA, would only be responsible if the authority defaults on the loan, which Czeponis is doubtful will happen since the authority expects state and federal reimbursement.
"I can't see why anyone would be unhappy about this," Czeponis said.
Attorney Joe Piece, the bond counsel, informed the board the approval wasn't necessarily needed Thursday night as long as the authority had enough money to pay Concrete Protection & Restoration Inc., of Maryland, for their first bill.
Councilmen Robert Barrett, who is also an authority member, and Moser made and seconded the motion to postpone council consent for the loan until the July 18 meeting. It passed unanimously 6-0.
Councilman Robert Shirmer, who is also an authority member, suggested Matulewicz and other councilmen attend the authority board meeting at 6 p.m. Wednesday in the borough hall, Fourth and Vine streets, in order to have all concerns addressed.
Matulewicz said he would also like to have Swatski, whose appointment by council expired this year, removed from the authority board, and replaced with himself.