New Castle News

December 3, 2013

Shenango considering sewer sale

Mary Grzebieniak
New Castle News

NEW CASTLE — Shenango Township is trying to decide whether to sell its sewer system.

A recent public meeting on the matter drew only about 15 residents and the Shenango supervisors said they will schedule another meeting to get more input.

Richard Christofer, managing director of the New Castle Sanitation Authority, and Deno DeLorenzo, independent accountant for the authority, attended the meeting.

The New Castle Sanitation Authority wants to buy Shenango’s sewer lines and lift stations for an undisclosed price. Christofer and DeLorenzo said because since the authority has about ten times the customers Shenango has, it has a better chance to obtain loans and grants for sewer expansions and the larger customer base could cushion rate increases.

Selling the sewer lines would free the township from any liability for them or responsibility for future line repairs. Sewer rates would remain the same for the 1,500 customers of the system. The township would receive money from the sale, but would have to give up approximately $140,000 it makes annually from running the sewer system.

The authority accepts waste from most Lawrence County municipalities. The exceptions are Mahoning Township and Bessemer Borough, which have their own treatment plants. West Pittsburg and North Beaver also treat most of their own sewage but provide a few customers to the sanitation authority. However, only the city of New Castle’s lines are owned by the authority, which purchased them in 2010 for $17.3 million.

The authority also has offered to buy Union’s and Neshannock’s sewer lines. Neshannock, which has 3,500 customers, turned the offer down and Union Township, with 2,000 customers, has not made a decision. Supervisor Pat Angiolelli said township officials will decide this month or next.

The rest of the county’s sewer systems are small and the sewer authority is not interested in buying them at this time, according to Christofer.

He said he would like a decision from Shenango by Dec. 31. He said that if Union Township agrees to sell its system, he wants to issue bonds only once for both Shenango’s and Union’s sewer systems to save money. To do them separately would cost $250,000 more and impact the sale price for Shenango, he explained.

Larry Herman, a Shenango supervisor who lost his re-election bid, said that although he will not be in office, if the township decides to sell the sewers, he would like the proceeds from the sale to be used to pay off the community’s $1 million sewer debt.

Some residents worried New Castle would get preferential treatment over Shenango in competition for development funds. However, DeLorenzo said the authority would treat Shenango “as our own child.” He explained authority officials would be happy to embrace development in Shenango because it would mean more customers for the authority.

Christofer added Shenango would not compete with New Castle for expansion funds because “there is no room to expand sewer in New Castle.”

He said everyone has sewers except four customers on Frank Avenue. Shenango already had a study done and is waiting for word on a proposed 1,000-home sewer expansion out Route 65, Old Pittsburgh Road and the Castlewood areas, which are priority areas for the Pennsylvania Department of Environmental Protection.

Residents also asked whether Shenango would have any say on the sanitation authority’s board. Christofer said the law requires a seven-member board and the majority have to be New Castle residents. Three township residents sit on the board and a Shenango Township member could be appointed when the term of one of the township residents expires, he said.

Board members, who are appointed by the New Castle mayor with the approval of city council, are: David Richards, chairman; Dom Grant, Joe Ambrosini and Chris DeJoseph, all of New Castle, and Chuck Viggiano, Reno Marcotuli and Anthony Cialella, all of Neshannock Township.

The sanitation authority financial statements show total assets at the end of 2012 of $40 million and unrestricted reserves of $6 million. According to the financial statement, operations are funded by customer revenues. Expansions are funded by customer revenues, federal and state grants and loans, bonds and other financing.