The turnout was only a trickle for Mayor Ed Pawlowski's first public meeting to explain why leasing Allentown's water and sewer systems would be a financial bonanza for the city.
And the mayor's enthusiasm for the idea was not dampened after he answered a steady stream of skeptical questions for just over a half-hour Thursday night.
Pawlowski and other city officials made up a sizable percentage of the four dozen or so people sprinkled about the auditorium at Dieruff High School.
Before taking written questions, Pawlowski spent about an hour on a power-point presentation explaining how he's rebuilt the city's finances since taking office in 2006. He summed things up by saying, "We've not just cut to the bone, we've cut through the bone." But, he said, the $130 million the city owes in pension liabilities is "an anchor that keeps sinking the ship."
Then he moved on to ideas to raise money to meet those liabilities, including many years of large tax hikes, floating pension bonds, and leasing or selling city assets such as the municipal golf course and the parking authority. None of those ideas would work, Pawlowski said.
But a 50-year lease for Allentown's water and sewer systems, which are valued between $160 million and $180 million, could put the city on firm financial footing for years to come, said Pawlowski.
The city might even receive one-and-half to two times the systems' value, the mayor said.
"If we got double, we'd be a debt-free city. You wouldn't have to raise taxes for the next five to seven years, and you could pay for more police and fire protection," Pawlowski predicted.
Pawlowski also laid out a timetable to turn the lease plan into a reality by the end of the year. He said he hoped city council would decide whether to support the leasing plan sometime in September.
He added that decision will show the 20 or so private companies and public bodies who've already expressed an interest in a lease if there is the political will for the plan. Each interested group would have to spend about $1 million to put together a proposal, Pawlowski estimated.
Several of the questions from the audience revolved around two topics:
potential water and sewer rate increases and whether the people working in the water and sewer departments would keep their jobs and benefits.
Pawlowski said there's no stopping water and sewer rates from rising in the future.
"They're up 196 percent over the last 20 years, and up 60 percent the last 10 years," he pointed out. But the lease agreement would establish an Office of Customer Ombudsman to monitor potential rate hikes, and the Public Utility Commission would also have to approve any increases, Pawlowski said.
If a public body such as the Lehigh County Authority wins the lease, "we would ask for proportional representation, so we would have the ability to control rates and increases," the mayor said.
As for changes in the workplace, Pawlowski pledged to write into the lease that existing labor agreements remain in force, with the goal that no jobs be lost. He said every lease bidder would have to accept that condition, and even offering substantially more money would not make a difference.
One questioner wanted to know how Pawlowski felt about a company sending profits from Allentown overseas. "I don't know who's going to bid, and I don't really care what [the lease winner] does with the money. That's their business."
Pawlowski didn't directly respond to a questioner who wanted to know if there was anyone on his advisory panel who opposes the lease. "I spent hours on Google looking at [stories about] lease agreements and found only a few that were negative," Pawlowski said. "I looked at the pros and cons and decided we [could] to do this."
Asked how a company would recoup its $160 million investment, Pawlowski said expanding is "incredibly expensive" if a company has to build a new system. Leasing or buying a system is much cheaper, "and there's massive growth potential on the horizon in our area.
According to the census, the Lehigh Valley could add 200,000 people in the next
10 years," Pawlowski said.
Only one question puzzled Pawlowski: Would the lease have a bias against a company selling water that would be used for drilling for natural gas, which is also known as fracking? "I haven't thought about that," the mayor confessed. "I will talk with council about it."
The next public information session is set for Aug. 9, at the Scottish Rite Cathedral on Hamilton Street. It will begin at 7 p.m.
The venue for the third session, on Aug. 16, has been changed to the Lehigh Valley Health Network's Mack Auditorium on Mack Boulevard. That session will begin at 6 p.m.
So will the final session, which is set for Sacred Heart Hospital on Chew Street on Aug. 23.