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Lehigh County Authority lays out benefits of Allentown water, sewer lease

Published On: Jun 14 2013 01:10:46 PM CDT
Updated On: Jun 15 2013 11:05:51 AM CDT
ALLENTOWN, Pa. -

With the Lehigh County Authority’s takeover of Allentown’s water and sewer system complete, now the public relations campaign to win over the city’s residents is underway.

The first of three public meetings was held Thursday night at the Jewish Community Center with a decidedly different feel than the night city council voted 6-1 to approve the $220 million sale on April 25.

About a dozen people showed up to hear the LCA's presentation, which was largely a regurgitation of previously disseminated information with some additional background. Residents peppered LCA officials, including Aurel Arndt, LCA general manager, with questions that ran the gamut of environmental concerns to rate hikes, to water sources and the purification process.

The main issue for most Allentown residents, of course, is what will happen to their water and wastewater rates now that LCA is calling the shots.

LCA officials took great pains to mollify those concerns, noting that the contract negotiated with the city limits how much LCA can raise rates for “most homeowners and businesses each year.”

As part of the deal, city water customers will experience no rate hikes during the first three years of the deal. From the fourth year through the 20th, rate increases will be contingent upon the Consumer Price Index (CPI) plus 2.5 percent for a total of about 5 percent. Then during the final 30 years of the deal, rate increases will be created through the same formula but with the capped percentage resting at 2 percent instead of 2.5 percent.

LCA argued Thursday night that Allentown’s water and sewer rates have been increasing about 5 percent each year for the past two decades, and by comparison, the hikes would be on par with that.

Officials took that theme one step further and produced a slide that indicated LCA kept water rates steady for their customers between 2001 and 2010 until rates spiked in both years 2011 and 2012.

In a further effort to placate Allentown customers, LCA officials noted city residents would benefit in three other ways:

  • The LCA is eligible for grants and tax-exempt financing, thus resulting in a lower cost of service.
  • Customers’ rates are based on actual cost of service, which are operating costs, overhead, debt service and bond coverage.
  • That LCA brings a long-term, regional, non-profit perspective that protects ratepayers, while looking out for the public’s health and cognizance of environmental resources.

And in an effort to add a value component to their argument, LCA noted that "the operating standards from the lease are challenging."

The LCA noted that it is now serving most of the communities adjacent to Allentown.

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The timeline of upcoming events noted that Allentown residents will receive their final water bill from the city during the month of July. Starting Aug. 1, all service and billing will be switched to LCA, and customers would receive their bills on whatever cycle they had previously. There will be no bills issues during August, the since the LCA won’t actually have anything to bill for during that month.

Two additional public meetings scheduled during June.