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Allentown City Council rejects another attempt to have residents decide 50-year lease

By Randy Kraft, WFMZ.com Reporter, RKraft@wfmz.com
Published On: Mar 07 2013 04:38:15 AM CST
Updated On: Mar 07 2013 08:26:06 AM CST

Allentown water sewer lease debate

ALLENTOWN, Pa. -

Another attempt to empower Allentown voters to decide the city’s planned 50-year lease of its water and sewer systems went nowhere at Wednesday night’s City Council meeting.

City resident William Hoffman asked council to pass an ordinance that would require any lease of the water/sewer facilities be approved by a referendum in a primary or general election at least 30 days after such a lease is approved by council.

Such an ordinance would give the city’s voters the final word and could reverse any approval of the lease by council.

But it raises the question of why council would approve a lease as well as an ordinance giving city voters the opportunity to reverse that approval.

Hoffman told council it could approve the ordinance he proposed and direct Lehigh County to put the referendum question on the May 21 primary ballot.

Resident Michael Donovan supported Hoffman’s proposal, Asking council to consider it, Donovan said two former elected city officials “are recommending this and feel very strongly about it.” He is a former City Council member and Hoffman is the former city controller.

Jeanette Eichenwald, the only City Council member who openly opposes a lease, proposed an ordinance that stated “any sale or lease of water and/or sewer facilities or operations will be subject to voter approval at the next primary or general election occurring at least 30 days after approval of such proposed transaction by city council.”

“In other words,” said Eichenwald, “if City Council approves the privatization of our water and sewer, the voters would then have the final say.”

Before that ordinance could be introduced, Eichenwald had to get council to suspend its rules. Her motion to suspend the rules was seconded by council member Peter Schweyer. But that motion failed by a 4-3 vote.

Only Schweyer and Joe Davis joined her in voting for it. Voting no were Julio Guridy, Cynthia Mota, Ray O’Connell and Jeff Glazier.

Vowing “I’m not going to give up,” a disappointed Eichenwald said she will propose the ordinance to council again, without trying to suspend the rules. But even if council passes the ordinance after it is considered at two meetings, she said the referendum now cannot be put on the May ballot. She said if council approves a lease and the ordinance, voters won’t be able to possibly overturn council’s vote until November.

In January, City Council voted 6-1 against another proposed bill that would have allowed Allentown’s voters to determine the fate of the proposed lease in the May primary. Only Eichenwald voted for that bill.

On Wednesday, Eichenwald said rather than being one against six other council members, she is among 4,501 in opposition to the six.

Hoffman and Donovan were members of a petitioners committee that unsuccessfully attempted to have the sale or lease of any city-owned property worth more than $10-million put on a referendum.

“We gathered 4,500 signatures,” said Hoffman. “Had we had time, we could have gathered twice that, or three times that or four times that.” He said that show of support proves city voters want to be involved in the decision to lease the water and sewer systems. He said council can validate all those voters by supporting the ordinance.

Hoffman said his committee’s referendum effort failed because of inconsistencies and conflicts between city and state law “and because of mistakes made by myself and others.”

Resident Don Ringer complained that three of City Council’s seven members were not elected, but appointed to fill unexpired terms. “We should table this thing until we have a council that is elected by the people and for the people,” said Ringer. “There were 4,500 signatures. We could have gotten 20,000 signatures. You’re completely ignoring all those people.”

Dan Poresky of Citizens for Allentown’s Water told council “we can mobilize thousands of people. Thousands of people are concerned about this, not just 20.”

Mayor Ed Pawlowski recently said only 20 people have spoken in opposition to the lease at City Council meetings.

Resident Helen Hahn reminded council that many people have stood before it “month after month to tell you “do not lease the water’.”

Allentown resident David Melman, a lawyer, told council he stands with Eichenwald in opposing a lease. He said the issue should be on a referendum, because “the people have a right to have a say in what happens to their water in their city.”

Melman warned the city will abdicate its responsibility to provide safe, affordable and clean waster to its citizens if it leases the water/sewer systems. “Corporations do not have that duty to us.” He said their duty is to their profits and their shareholders “at the expense of our city.”

Resident Lou Hershman called on City Council to reject the “flawed” lease before the administration even presents council with a bid, which Pawlowski plans to do in early April, after getting bids from six competing companies on March 21.

A similar opinion was offered by resident Rich Fegley: “I don’t understand why this plan isn’t just taken off the table now.” Saying the proposed final agreement made public last week is just getting worse, Fegley noted it will reduce annual royalty payments by $2 million a year, which will cost Allentown $100 million over 50 years.

Poresky also recommended council say no now “and give the problem back to the mayor where it belongs.” He also said council still can let voters decide by putting the privatization question on the ballot.

Ryan Hunsicker, Allentown chapter leader of SEIU, said changes made by Pawlowski in the final proposed lease agreement are very “troublesome” to city employees he represents. He predicted 98 percent of about 110 employees working for the city’s water and sewer systems will want to be “bumped back” into the bargaining unit rather than going to work for whatever company wins the lease.

“Bumping” refers to city employees going to other city departments, sometimes into totally unfamiliar jobs, bumping other people out of those jobs. But if they can’t handle the new jobs, they could be out of work.

Hunsicker said mistrust in the administration is growing, because of “facts that just aren’t the facts.” He said the mayor’s contention that “nobody’s going to lose their job is a complete fallacy. There’s no possible way he can retain all those people coming back into the city.”

Mike Duffy of Washington, D.C., deputy director for SEIU Local 32BJ, explained why city workers will not want to work for a company leasing the water and sewer systems. He said pension protections have been gutted in the final version of the lease agreement. Unlike an earlier version of the agreement, he said bidders no longer have to match pension benefits that workers now enjoy as city employees “or even provide any retirement protections whatsoever.”

Duffy also said the final proposed lease no longer caps mandatory contributions workers must make toward their retirement plans.

He maintained the proposed agreement gives a competitive advantage to bidders that have “lousy retirement plans.”

Duffy said the mayor’s final version of the proposed lease constitutes “a betrayal of trust” by Pawlowski and that the process has been “clouded with lies and misdirection.”

“This makes us wonder about what other changes we haven’t discovered,” he said. “It calls into question the transparency of this process. We’re counting on City Council to be a backstop to these kinds of shenanigans and ultimately voting against privatizing such a vital service.”