York City will pitch wastewater sale at two public forums

Logan Hullinger
York Dispatch
The City of York's wastewater treatment plant.
Tuesday, August 25, 2020
John A. Pavoncello photo

York City officials will hold two public forums  to discuss the potential sale of the wastewater treatment system, a would-be transaction based on which the city council passed on Dec. 30 a budget without substantial tax hikes.

City officials at the two forums, scheduled for noon and 6 p.m. Thursday, will be joined by members of the Pennsylvania Economy League and Pennsylvania-American Water Co., according to a city news release.

The company's $235 million offer was the highest among four bidders interested in purchasing the sewer system. 

The public will be able to comment on the proposed sale, which still requires the approval of the York City Council and the York City Sewer Authority — something a new regional water authority aims to prevent.

More:York City avoids government shutdown, passes budget

More:As York City eyes sale of wastewater system, six municipalities ask for control

The reason for York City selling the system is to plug a $14 million deficit in its $116.8 million budget, officials have said.

With a budget contingent upon its sale, Mayor Michael Helfrich's proposal unanimously passed and avoided a 48% property tax hike, numerous fee increases and the loss of 21 of the 27 jobs initially proposed for elimination. 

Council member Edquina Washington initially prevented the budget's passage in a previous meeting, citing concerns about an alleged lack of planning for how the revenues from the sale would be used. 

In the following meeting on Dec. 30, though, she reluctantly flipped her vote just one day before the annual budget deadline, avoiding a government shutdown.

The City of York's wastewater treatment plant.
Tuesday, August 25, 2020
John A. Pavoncello photo

Still, a recently formed regional sewer authority continues to lobby against the sale that city officials argue is the only way to buoy the city's troubled finances.

The York Area Regional Sewer Authority, composed of five surrounding municipalities, sought to purchase just the wastewater plant. Its members have argued that keeping the plant under local control would be the best way to keep rates down.

Timothy James, chair of the authority, in a statement issued Tuesday criticized the proposed deal because Helfrich's budget only accounted for $197 million of the sale price, leaving the remaining funds unaccounted for.

"While the City feels good about these additional surplus funds, transferring additional fee increases to City residents to pay for this 'good feeling' is not the best long-term financial interest and well-being for residents and businesses," James wrote.

James also noted that Pennsylvania-American Water Co. has a history of seeking increased rates, a key aspect of the authority's case against privatization.

Helfrich, though, over the past few weeks has made counterpoints to claims about a lack of planning for funds and potential rate hikes.

For example, he said the city would likely put remaining funds into short- or long-term investment accounts to bolster the city's economy that has been hamstrung by rising pension costs and the COVID-19 pandemic.

The deal with Pennsylvania-American Water Co. would also lock in rates for three years. And, as required by law, any changes after the fact would need approval from the state Public Utility Commission.

— Logan Hullinger can be reached at lhullinger@yorkdispatch.com or via Twitter at @LoganHullYD.