Sewer authority to float $25 million bond
Canonsburg-Houston Joint Authority, the board that oversees the sewage plant in Canonsburg, voted Tuesday to float a $25 million bond for overdue upgrades to the plant.
The motion to take out a guaranteed sewer revenue bond, which would be backed by both Canonsburg and Houston boroughs, was a definitive step toward ending negotiations that lasted more than six months.
Both boroughs also must approve the motion for it to move forward. Members of Houston Council and solicitor Josh Carroll said they supported the measure, and at least two members of Canonsburg Council said they would vote in favor of the motion.
The special meeting was held after Huntington Bank, financial adviser in bond discussions, suggested the board consider a guaranteed sewer revenue bond as opposed to a general obligation bond. The authority board unanimously approved that option, which was one of eight options considered.
Authority member John Bevec, also Canonsburg Borough president, said he voted yes “in the spirit of cooperation,” but actually preferred the first option for Canonsburg to issue the bond. He pointed to a comparison chart showing the first option would save them $119,290 per year – or $3.6 million over the course of a 30-year bond – because the borough would not need a debt service reserve fund.
“I still believe that the best scenario for all involved, with a risk-reward assessed, is this option A1,” Bevec said at the beginning of the meeting.
Authority member Rob Luksis said the project is at least eight months behind schedule. He said he would consider either option, depending on the general consensus, because he felt the board could not delay any longer.
“It’s the quickest (and) cheapest way for everybody to get shovels in the ground,” he said of the first option, “but it comes down to what is the path of least resistance.”
Authority President Mike Alterio said he felt more comfortable taking Huntington Bank’s recommendation, despite the lack of cost savings. A bank representative was not present at that meeting to reiterate the bank’s financial opinion.
“We hired these people to do what they did. I think they did a very good job,” Alterio said of Huntington. “I understand everybody and what their thoughts are, whether it’s A1 or B1, but personally I’m inclined to go with B1 simply because that’s Huntington’s recommendation.”
The authority also is on track to become an operating sewer authority independent of both Canonsburg and Houston boroughs by 2016. Once changes go into effect, plant workers will be directly employed by the authority rather than by Canonsburg.