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After nearly two hours in executive session during a special meeting Wednesday afternoon, legal representation for Charleroi officials said the borough has been left with “no choice” but to move forward with dissolution of the Authority of the Borough of Charleroi. A statement was read by Thomas Wyatt of Obermayer, Reman, Maxwell & Hippel, a law firm that works with municipalities across the state in sales, contract negotiations and purchases that specialize in water/waste-water facilities. The firm was hired by the borough in March to handle matters related to ongoing negotiations with ABC.

Only six residents attended Wednesday’s early meeting, and without any official business on the agenda, council members took roll call and entered into an executive session that was called due to potential litigation.

After everyone was invited back into council chambers, Wyatt offered a brief statement on behalf of the borough:

“After many months of public discussion and several months of diligent and quiet efforts to reach a resolution that would result in a long-term partnership with the Authority of the Borough of Charleroi and resolve our MS4 and collection system issues, the members of

CHARLEROI • A7 FROM A1 Charleroi Borough Council have concluded that there is no option other than to begin the process of taking over ABC.”

The public had the opportunity for the first time Wednesday to learn more about the status of negotiations regarding ABC’s attempt to purchase the borough’s sewer lines — but it seems they haven’t progressed very far.

Charleroi council will have its first reading of an ordinance in June that would dissolve ABC and transfer its assets to the borough.

“The borough is not contemplating an eventual sale of ABC assets,” Wyatt said. “Thus, this potential action will not result in any change to customer rates or any change in the dedicated employees currently working for ABC.”

Wyatt said ABC is considered a borough asset under the law.

“The borough created ABC in 1937 and has appointed its board members to this day,” he said. “ABC has significant funds beyond the money it needs to maintain its systems. The borough will utilize those funds for the betterment of our community, and we will also analyze all of ABC’s existing contracts and relationships to ensure the public is getting the best value for its dollars.”

Wyatt said the door is still open for continued discussion, but time is running out. “We hope ABC will return to the discussions with the borough, but if it fails to do so in the next few days, the borough will act accordingly,” he added. “We do not take this decision lightly and realize it is a momentous action. However, the Charleroi community, its residents and business, need funds to fulfill obligations — including many government-mandated obligations relating to the water and sewer system — as well as stabilize the finances of the borough without having to continually raise taxes on its citizens and businesses. “The elected officials of the borough have worked tirelessly to get the cooperation of the appointed board of ABC, and we are left with no choice but to take this step.” Not everyone at Wednesday’s meeting agreed with that statement.

Kristin Hopkins-Calcek, one of four successful council candidates in last week’s primary election, attended the meeting to pose a few questions to borough officials. She wasn’t able to get a direct answer to some of them, including the cost of Wyatt’s work up to this point. She also told officials she disagrees with the timing of such a big move.

“If a new council is coming in January, why are we in discussion to dissolve our biggest asset during this year?” Hopkins-Calcek asked. “There should not be this big of decision, not one that only affects this town, but its services that would impact the borough and the water authority.

“You said no one is willing to negotiate, and I don’t agree with that. I know that this has been talked about for a number of months, so to say they don’t agree to negotiate is malarkey.”

Hopkins-Calcek and various members of council, including Paul Pivovarnik and Larry Celaschi, went back and forth on several issues primarily related to the rates charged by Wyatt’s firm before solicitor Mark Stopperich, a colleague of borough solicitor Sean Logue’s firm, stepped in.

“We’re going to end the meeting,” Stopperich said. “There was a comment section, but you don’t know half of what is going on. He (Wyatt) is not here to be shanghaied. He works for the borough. You folks can run down the road or to the media, but this is not supposed to happen.”

Councilman Frank Paterra attempted to allow the meeting to continue because he wanted to hear what members of the audience had to say, but council asked for a roll call vote to adjourn per the solicitor’s recommendation.

Discussions on the matter will continue — and will be open to public comment — at the borough’s agenda meeting June 7.

ABC Solicitor Dennis Paluso, who did not attend Wednesday’s meeting, said in a phone call with the MVI that ABC disagrees with several remarks made in the statement.

“There are several discrepancies we have and we believe a cursory review is necessary,” Paluso said. “We want to review this in detail, line by line, and respond accordingly.”

The move to hire Wyatt and his firm has been a point of discussion for more than two months.

Wyatt first spoke to council Dec. 7, the same night it was revealed that the authority had made a $2 million offer to the borough for the sewer lines.

At that meeting, Wyatt discussed services he could provide concerning a potential sale or other negotiations concerning ABC. Some council members questioned if hiring outside council was necessary, and they were worried about how they could pay for the service without having passed a budget at that point.

As talks with ABC continued, motions to hire the firm were put on the agenda Dec. 27 and again Feb. 7, but both times it was tabled.

It was reintroduced at a March 1 agenda meeting, and he was eventually hired to serve as outside counsel for all business related to ABC. The $2 million offer was rejected by council because the borough hadn’t confirmed the value of the sewer lines. Under that offer, ABC would have taken on a $4 million PennVEST loan along, with an ongoing MS4 project that could cost up to $800,000.

In the weeks following the rejected offer, ABC had its engineering firm, KLH, conduct an assessment. That assessment was formally presented to ABC officials at a public meeting in March.

KLH stated that the sewer lines, which were constructed in 1930, are approaching the end of their useful life and are in poor condition. It adds that they require immediate repairs at a cost of $525,822, plus additional costs for a system-wide cleaning.

KLH also said the authority is currently paying debt for the stormwater system, which will amount to $4,594,795 through 2037.

The firm cited the borough’s estimate that MS4 projects to bring the system into compliance will cost about $800,000.

In addition to these expenses, the firm contends the sewer system and stormwater system do not generate any revenue.

Wednesday was the first time matters between ABC and the borough have been discussed publicly since Wyatt was hired in March.

“We hope ABC will return to the discussions with the borough, but if it fails to do so in the next few days, the borough will act accordingly. We do not take this decision lightly and realize it is a momentous action.”
THOMAS WYATT
OBERMAYER, REMAN, MAXWELL & HIPPEL

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