Lackawanna County plans to borrow more than $29 million to pave roads, fix or replace bridges and pay off earlier borrowing without another property tax hike.
County chief financial officer David Bulzoni outlined the proposed borrowing during a Board of Commissioners meeting Wednesday. To raise the money, Bulzoni said the county would sell bonds that would be paid back over 25 years.
The commissioners introduced an ordinance to issue the bonds. They plan to vote on it next Wednesday. The borrowing will mean spending more paying off debt next year, but Bulzoni warned against the dangers of further delaying long-overdue construction projects.
“Many of the roads and bridges are classified in poor or critical condition,” he said. “I'll close by just saying that if we've learned nothing from last year, when the county was hemorrhaging revenue, this isn't a Disney film. It doesn't have a happy ending, unless you really work very hard at it. That's what we're trying to do. We're really trying to create some momentum for the county going forward, so that ... people can use our roads and bridges.”
County documents say the county would sell $29.125 million in bonds — $11.995 million to pay off a note issued in December 2023 and $17.13 million in new money for infrastructure.
The borrowing would mean the county will have to budget almost $1.1 million more to pay off debt next year ($22,327,575 this year and $23,403,900 next).
That’s roughly equivalent to the money raised by 1 mill in property taxes. Bulzoni said the higher debt payment won’t require a tax increase because the county will use the balance in a debt service fund. A debt service fund contains money set aside to pay off loans, bonds and notes.
Property taxes remain an especially sensitive topic among taxpayers and county officials these days because the county raised its property tax 33% this year to close a massive budget deficit.
Bulzoni said the county should borrow as little as possible during the next decade to stay on track toward the annual county debt payment dropping by about $11.6 million in 2036. That’s the equivalent of about 8 mills at current valuations, though that millage will change when new property values take effect Jan. 1 because of reassessment.
The 33% tax hike was a 22.31-mill tax hike. A mill is a $1 tax on every $1,000 of assessed value. The county tax rate is 89.98 mills this year.
Commissioner Bill Gaughan said he will support the borrowing.
“These are not just numbers on a spreadsheet. These are the roads that our families drive on. They’re the bridges that connect our neighborhoods,” he said. “I understand that people are weary of governments borrowing money, especially right now, because of the financial situation that we're in. But as Mr. Bulzoni pointed out, through careful financial planning and the use of this long-term capital financing, we can make these crucial investments without placing an additional burden on the taxpayers of Lackawanna County.”
Commissioner Chris Chermak said he would vote for the borrowing but would press state and federal legislators for grants to help pay for the projects.
“This is definitely something that we have to continue and stay on top of,” Chermak said. “We're going to push the heat on them, and hopefully they'll come up with some funding that we can put towards these projects to help with our borrowing situation.”
Bulzoni said the county has already acquired about $8.5 million in state and federal grants to help pay for the projects, but can seek more and can also apply for lower-interest federal and state loans for future projects if necessary.
The 2023 note, which must be paid off by June 15, totaled $11.4 million originally. That note was coupled with the sale of $14.225 million in bonds repayable over 15 years.
The note was targeted at paving Center Street near the county Government Center, a Stauffer Industrial Park road in Taylor, Montage Mountain Road and Glenmaura National Boulevard in Moosic and Scranton, and Main Avenue in Blakely; and the Gordon Avenue storm sewer project in Carbondale.
Montage Mountain Road and Main Avenue in Blakely are scheduled for paving this year. County roads and bridges director Larry Lukasik said Montage Mountain paving could begin Monday.
The county, according to the memo, will also use part of the remaining note money to design the replacement of the:
• Ash Gap Road Bridge in Springbrook Twp.
• Old Mill Road Bridge in Jefferson Twp.
• Poplar Street Bridge in Mayfield.
The new bond money will go toward designing the replacement of and/or replacing or repairing the:
• GC Smith Road Bridge in Elmhurst Twp.
• Ash Gap Road Bridge in Springbrook.
• Plank, Keystone and Phillips Road bridges in Clifton Twp.
• Rushbrook Creek bridges in Jermyn.
• Lehigh Road Bridge in Covington Twp.
• Earl Clark Road Bridge in Benton Twp.
• Pumphouse Road Bridge in Jefferson Twp.
The money would also go toward repaving Gilmartin Road in Archbald.
The 2023 bond money was targeted at replacing the #5 Dam, replacing the county prison roof, fixing retaining walls in Blakely and Elmhurst and projects meant to save energy across all county buildings, including the Children’s Library in Scranton.
