West Mifflin sanitary authority turns to county for help
West Mifflin Sanitary Sewer Municipal Authority members say they will apply to the county for $500,000 to help pay the costs of a sewage line rehabilitation project mandated by the state.
The board’s action to approve the request of a grant and loan from the Allegheny County Community Infrastructure and Tourism Fund, each for $250,000, was taken at a special meeting called for that purpose on Friday, two days after West Mifflin council members indicated the borough had no intention of guaranteeing another loan the authority had sought from the state.
Authority board members were calling the requests to the county “plan B,” because they said work needs to get started on problem lines in the Homeville tributary that allow storm water to infiltrate sanitary sewers.
The original cost estimate for the work — and the amount of the PennVEST loan as it was discussed by borough council — was $1.2 million.
WMSSMA chairman Richard Babjak said that, thanks to work by authority crews, the scope of repairs to the lines was reduced and the price tag for the repairs is now estimated at approximately $750,000.
WMSSMA acting general manager Ken Frick said bids for “slip lines” that would be installed inside existing pipes to prevent leaks came in lower than was expected on the original estimate by the authority’s engineering firm Chester Engineering. He said the authority’s in-house employees don’t have equipment to install the linings themselves.
Had the original plan to acquire the PennVEST loan come through, Frick said the amount of the loan would have had to be adjusted to conform with the actual cost of the remaining work because the state loans must be used
for the purpose for which they are approved.
Because the amount the authority is currently seeking from the county is approximately $250,000 less than the expected cost of the remaining work, Frick said the outstanding amount possibly would have to be taken from the operating budget.
Borough council had expressed concerns earlier in the week about co-signing for the PennVEST loan out of fear that doing so could lower the borough’s bond rating. Council members noted then that the authority had received PennVEST loans previously that had not required the guarantee of the borough. Council members had wondered aloud if the authority’s financial picture isn’t as good as it was in the past
Authority solicitor Bill Shimko responded Friday to the concern.
“This is something new that PennVEST is doing. Literally, the overwhelming majority of the loans that PennVEST gave this year required a municipal entity guarantee,” Shimko said. “The economy is tight.”
There have been concerns that by not helping the authority get the PennVEST loan, which has an interest rate of 1 percent, the borough would be forcing the authority instead into a higher interest loan. It was unclear how much the interest rate on an infrastructure and tourism loan would be.
The county program draws its revenues from the gaming industry.
Council is considering hiring the utility industry consulting firm AUS Consultants to investigate authority operations.
Babjak, responding to a comment made by Councilman John Andzelik on Wednesday that the authority was “hiding something” because it had not met with council to discuss its borrowing plans, said that is not the case.
“This board has nothing to hide. We made an attempt (to meet),” he said. “Our books are open.”
Authority treasurer Albert Kopay added, “I’d like for somebody to come down here and find what we’re hiding. For them to even say that, that’s pretty low.”
Babjak said the authority is responding to council in a letter stating the authority will meet with council in their chambers.
Babjak added that hiring AUS would only waste taxpayer money. He said the authority has been proactive in saving money in the past by negotiating a better health plan for employees that saved $187,000 this year and has a better pension fund rating than the borough.
Authority officials said they hope to get work started on the project by Dec. 31.
Councilwoman Rhonda Popovich, who did not attend the meeting Friday, said she is not sure what direction council will take concerning hiring AUS. Popovich had no comment on the authority’s decision to request the county money.