SHARPSVILLE, PA. Consulting company presents specifics of water plant issue

Selling the plant would put $5 million into the borough's coffers.
By HAROLD GWIN
VINDICATOR SHARON BUREAU
SHARPSVILLE, Pa. -- David Killa of Hazen Road doesn't understand the debate over whether the borough should keep or get rid of its water plant.
"To me, it's a no brainer to sell," he told borough council during a special meeting Wednesday to hear a report from a Pittsburgh consulting company on various options for the plant.
Resource Development and Management Inc. was hired to look at three basic options: Rehabilitate the plant, replace it or sell it to Consumers Pennsylvania Water Co.
The consulting firm didn't make any specific recommendations but spelled out what would happen with water rates under those three scenarios.
Selling the plant "sounds like a good deal to me," Bill Gargano of Hazen Road told council after hearing the report.
Consumers will pay about $5 million for the water system which the borough would invest at a guaranteed 5 percent interest rate for five years, earning $256,200 a year in interest to be used to balance the general fund budget.
Further, Consumers would put $225,000 a year for five years into improving borough water lines, plus pay the borough to keep running the plant for five years.
"It's time to sell, gentlemen," Gargano said.
Earnings and taxes
The meeting was held in the Sharpsville High School auditorium in anticipation of a large crowd, but only about 35 people showed up. Most of those who spoke favored selling the plant.
If the plant is sold, the $256,200 in annual interest earnings could be used to lower property taxes, said Gene Piehuta of South Ninth Street, taking a cue from the report, which said tax reduction could be one result of a sale.
"My advice to you is to sell," said Cheryl McClain of South Ninth Street.
Some in the audience feared that selling the plant will lead to higher water rates that could cause Dean Dairy, the area's largest employer, to close its South Pymatuning Township operation.
Sharpsville sells water in bulk to South Pymatuning which sells it to Dean Dairy and other customers.
Officials said there are no guarantees about what Dean Dairy might do.
However, Sharpsville residents will be facing higher rates no matter which option council chooses.
Residents' cost
The study shows that a $1,875,000 renovation of the plant would result in the average residential monthly water bill rising from $22.95 to $38.87 by the year 2009.
A less expensive plant improvement pegged at $600,000 would raise that average rate to $35.59 by 2009.
Building a new plant at an estimated cost of $3.2 million would cause that monthly rate to rise to $38.06 by 2009, while selling to Consumers would result in the rate rising to $45.06 by 2009, to bring Sharpsville residents up to the same rate that every other Consumers' customer would be paying.
Jack Cardwell, council president, said council will resume its discussion on the fate of the plant at its work session Monday.
He made no promises on when a final decision will be reached.
gwin@vindy.com