Wilkes-Barre’s 2022 budget moves toward approval

WILKES-BARRE — City Council Tuesday passed the first of two readings of Mayor George Brown’s proposed $54.4 million budget for 2022.

With a 5-0 vote Council moved the budget — that does not contain a property tax increase, but is balanced with $1.8 million in federal American Rescue Plan funds — closer to adoption before the end of the year.

As it did Tuesday night, Council next meets in a combined work session and public meeting at 6 p.m. on Dec. 7 in City Hall.

The only other item on the agenda for Council’s consideration required repeated assurances the city would not be responsible for repayment of a bond for an already completed science building on the campus of Wilkes University in the event of a default.

Wilkes dedicated the $35 million Lawrence and Sally Cohen Science Center in 2013 and financed the project with tax-exempt bonds issued in 2012 through the city of Wilkes-Barre Finance Authority.

“There’s no liability on behalf of the city,” Brown told councilman Mike Belusko who asked why the item was on the agenda.

Attorney Bill Rhodes of Ballard Spahr in Philadelphia, long-time bond counsel for Wilkes, explained the city is involved because of the federal tax code. In order for the Authority to issue tax-exempt bonds, it must receive approval of the highest elected official body of the community in which the project is located, he added.

“If the university were to fail to pay debt service on the bonds, the city of Wilkes-Barre Finance Authority has no liability to step in and, you know, make up any shortfall or otherwise be liable on that,” Rhodes said.

The school is taking advantage of lower interest rates with the refinancing of $18.5 million in bonds and will see a cost savings over the final 12 years of payments, Rhodes said.

“So just to reiterate. The city of Wilkes-Barre Finance Authority nor the city of Wilkes-Barre will be accountable if something should go into default,” said councilman John Marconi before the vote.

“Correct,” Rhodes replied.

The bond measure passed by a vote of 4-0-1 with Council Vice Chairwoman Beth Gilbert McBride abstaining.

Brown, following up on a question Marconi raised a few weeks ago about the status of the North Washington Street bridge, said he contacted Gov. Tom Wolf’s office and was informed the Pennsylvania Department of Transportation would be in touch with him Wednesday with an update on replacing the span.

The bridge in the city’s North End and Marconi’s District was closed in 2013 due to structural problems.

“As we get updates I’ll pass them on to you,” Brown told Council.

Brown also offered to ask PennDOT about the water runoff problem on East Northampton Street that McBride has repeatedly brought up.

“I think what we can do is tomorrow when PennDOT reaches out to me about the Washington Street bridge we can bring that up with them also,” Brown said.