SHAMOKIN - A controversial decision by Shamokin City Council to impose a fee on the joint sewer authority in return for guaranteeing a federal loan could be reversed at a special meeting next week.
Authority board member Phil Zalar and Coal Township Board of Commissioner Chairman Gene Welsh sought the help of Northumberland County Commissioner Vinny Clausi to help change the minds of council members.
"I think it's in the best interest of the taxpayer, after having it explained to me in a better manner, to go along with it. I'm glad I had the opportunity to research it more," Councilman William Milbrand said Thursday.
Council voted 4-1 Feb. 21 to request a 5 percent fee from Shamokin-Coal Township Joint Sewer Authority for guaranteeing a $17.6 million USDA loan over 40 years with a fixed rate of 2.375 percent to upgrade and expand the sewer plant.
Councilmen William Milbrand, R. Craig Rhoades, Michael Snyder and William Strausser voted in favor; Mayor George Rozinskie was opposed.
The fee would total about eight cents for each sewer customer, city clerk Steve Bartos previously said. That's in return for taking on the risk of a default by the authority, leaving both Shamokin and Coal Township jointly liable for the loan. The loan could top out at $19 million if interim financing for the project is necessary.
A guarantee would also save customers $3.58 apiece over the life of the loan, Bartos previously said, comparing that to the sought-after eight-cent fee.
'Unacceptable'
Clausi hosted an informal meeting Wednesday night at his restaurant, Two Guys From Italy, with Zalar, Welsh, Milbrand and Strausser.
"I told them it was unacceptable to charge the taxpayer again. I tried to convince them we could not afford to lose the project," Clausi said.
The sewer bills at his restaurant increased from $120 to $190, Clausi said.
"I don't want to pay any more sewer rates, and I'm sure the people in this part of Northumberland County do not want to either. We cannot afford more fees in this town," he said.
Milbrand said the fee idea was presented to council without any extensive details.
"We never had it properly explained to us," he said.
The decision was originally made because of Shamokin's financial troubles.
"We're looking for any way, shape or form to get some revenue in the city to take care of the deficit that was not caused by us. We've got to find a way out of it somehow," he said. "But through further research and gathering actual facts, I decided it would be in the best interest of the taxpayers to rescind the motion."
Both Clausi and Milbrand said Strausser was in favor of changing the decision, but he did not return a message for comment.
Mayor George Rozinskie noted he voted against the original motion.
"I don't want to see another burden on the taxpayer. I could not vote for that," he said.
Councilman Rhoades said he had several conversations since the vote was taken.
"In light of the fact that we have been made aware of information we didn't know before, I will be voting for rescinding the motion," he said.
Snyder did not return a message for comment.
Township's decision
The Coal Township commissioners said they would not charge a fee for the same guarantee, and Welsh was happy about the news.
"It's a great thing. We wanted to protect the taxpayers and that was the whole main goal, to get it straightened out, so the rates didn't rise. There was a chance we would lose the loan, so it's very important it happens," he said.
Zalar is looking forward to the meeting.
"I'm hoping it will go OK and they'll reverse it so the taxpayer won't have to get hammered again," he said.
The area doesn't need any more fees, he said.
"Hopefully, we can get this thing done. I don't know what we'd do without the bond," he said.
A special meeting will be held next week. If the vote sways in favor of the sewer authority, the new decision will have to be advertised for three days and then voted on again, according to third-class city code.