Dec 9, 2013

Dennis Pearson's Excellent Water Lease Explanation

The Allentown City Council is proud that it passed a budget council members claim is in the black. But it was done by leasing our water and treatment facilities to the Lehigh County Authority, which assumed the debt through its lease-purchase and compounded it with more debt ($320 million in total as compared to $167 million).
As an Allentonian, I am glad our financial situation is in the black. But continued fiscal responsibility is a necessity to keep it in the black. We don't need irresponsible actions that occurred in our past to be repeated in the future. But as an LCA user, I wonder how the authority will pay back the debt it assumed and what my share of the debt payback will be through my future user charges. You see, the pension debt has not disappeared. It was just transferred to LCA via the lease agreement.
Time will tell if the authority will be able to handle this debt to produce a soft landing for us water and sewer users in Allentown. What we don't want is a hard landing. A hard landing would be more expensive and stressful for consumers. We don't need irresponsible actions that occurred in our past to repeat in the future.                                                          
Dennis Pearson

The above appeared as a Letter To The Editor in The Morning Call on Sunday December 8th, 2013

6 comments:

  1. Good write up by Dennis. I would also like to add that the city has boasted of not having to increase fees and taxes. The lease agreement only shifted responsibility of those increases. We know the LCA will have to raise those fees to update our water system and pipes and I predict when it happens we will have the same Democratic politicians attacking the Republican Commissioners for doing so.

    -Steven Ramos

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  2. "Right on the money" Dennis (pardon the very timely pun). Thank You....PJF

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  3. steve@10:54, to my knowledge the LCA is not under the domain of the county commissioners, except for extending their charter. i do agree that city council will shrug their shoulders at each subsequent water rate increase and capital expense pass along by the authority.

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  4. There is no one out there to look at the real issue that the public is faced with now? There is the failing infastruture that has caused damage to private property and will continue to cause damage. The blame has been shifted around to an entity that has treated human life as a piece of property with no recourse?

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  5. @12:33, you raise an interesting point. the homeowners on 10th street, between chew and gordon, had little recourse when the main broke several years ago, and they were taxpayers to allentown. what now when those in a similar situation have to depend on, and deal with, LCA?

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  6. There is many others too, the 400 unit block of church st?



    The conflict of intrest becomes abundently obvious as allentown has excepted federal allocations to maintain the water supply infastruture, not doing the upkeep and than claiming private properties that have suffered because of the neglegence?

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