Dec 8, 2018 4 min read

CHARLEROI – Councilman Larry Celaschi unveiled a surprise plan to generate extra revenue at council’s most recent meeting, but reaction from the rest of the members was lukewarm.

Celaschi suggested officials consider replicating an approach that cash-strapped McKeesport took last year to address its deficit. Last December, McKeesport officials sold the city’s municipal authority to Pennsylvania American Water Co. for $159 million. The sale was the first time a municipality in the state went through Act 12 to sell its water and wastewater systems for a price that was based on the fair-market value of the system.

The 2016 law allows municipalities to sell their aging water and wastewater systems to private, investor-owned entities.

Celaschi, who believes this approach could also work for Charleroi, said the borough is running out of options.

“We have the same problems that McKeesport has,” said Celaschi. “We continue to beat a dead horse about our budget, and we are running out of time. However, we’re in a position now to use one of our assets to generate more money for the borough. This could be the salvation of Charleroi.”

Celaschi told council that Charleroi could net between $200 million to $250 million by selling its municipal authority.

“There are people who are willing to attend one of our meetings to talk more about this idea,” he said, adding that he already has held fact-finding meetings with officials from McKeesport.

Celaschi’s proposal appeared to catch the other council members by surprise. Councilwoman Jodi Cheplic asked Celaschi why he hadn’t brought the suggestion to them before.

“Considering that I am on community development with you, it would have been nice if you involved me with this sooner,” said Cheplic.

“Right now, they just wanted to meet with one person,” replied Celaschi. “I obtained this information and now I have brought it back to the council. This is the trend, and I think we have to start the ball rolling now.”

Celaschi also was asked if people could lose their jobs if the borough’s municipal authority is sold to a private company.

“Everyone who worked at McKeesport’s sewage authority retained their position and stayed at the same pay rate,” he said. “They just had to pass a drug test to continue employment. No one wants to see anyone lose their jobs.”

David DiPiazza, a board member of the Authority of the Borough of Charleroi, expressed concern that residents could see a rate increase if the borough sells its municipal authority.

“Here’s the problem: Pennsylvania American Water is a private company. I can almost guarantee that their rates are higher than what ours are now. I don’t have an issue with you, but in my opinion, our rates will go up, too,” said DiPiazza, who pointed out that the municipal authority “balances the budget, rather than making a profit.”

According to the terms of its agreement with McKeesport, Pennsylvania American Water Co. agreed not to raise rates for customers the first calendar year.

Council President Jerry Jericho appeared to be open-minded about exploring Celaschi’s idea further.

”I can say this much: It’s an interesting thing to think about,” said Jericho. “I don’t have a problem listening to what McKeesport did. But I want the authority to be at all meetings. We only got to hear one side of it.”

In other business, council voted to ask the state Department of Transportation to reopen bids for a project that would rehabilitate the storm sewer system along Fallowfield and McKean avenues.