Wyoming Valley Serra Club Holds Christmas Dinner

Already Looking Forward To The Second Half

By LANE FILLER lfiller@leader.net
 Friday, January 28, 2005 &nbsp;&nbsp;&nbsp;&nbsp;Page: 1A 





WILKES-BARRE - City council on Thursday night agreed to borrow $3.7 million
in the third of a four-step plan toward making the city's debt manageable. &nbsp;&nbsp;&nbsp; 
 The money will be used to make interest and principal payments in 2005 on
bonds the city issued in the past. &nbsp;&nbsp;&nbsp; The city now faces a total debt of about $67.5 million, an increase of
nearly $2 million, to be paid off during the next 16 years. &nbsp;&nbsp;&nbsp; 
 ``It's like a house you buy on a 10-year mortgage,'' said city Finance
Director John Koval. ``Most people can't afford to make that payment, they
need a 30-year mortgage.'' &nbsp;&nbsp;&nbsp; 
 Koval said the city began to undertake a four-step process to bring its
debt payments under control when Mayor Tom Leighton took office a year ago. &nbsp;&nbsp;&nbsp; 
 ``You have to understand, this is the culmination of a long-term plan to
bring the finances of this city under control,'' Leighton said. ``We inherited
a terrible mess, but with the last pieces of the puzzle coming together, and
fiscally prudent budgets on our part, we are digging out and things are
looking up.'' &nbsp;&nbsp;&nbsp; 
 The first step was refinancing about $4.5 million worth of bond debt in
2004. The second step was taking out a $10.8 million bond to pay off more than
150 city vendors whose bills had piled up during the term of Mayor Tom
McGroarty. &nbsp;&nbsp;&nbsp; 
 Step four, to occur during the next few months, is the refinancing of the
nearly $30 million pension debt. &nbsp;&nbsp;&nbsp; 
 That move will add several million more dollars to the city's total
obligation, but Leighton and Koval say that will be all. &nbsp;&nbsp;&nbsp; 
 ``At that point, we will be spending about $4.2 million per year to service
our debt, and that is what we have calculated, with the help of Public
Financial Management, we can handle,'' Koval said. &nbsp;&nbsp;&nbsp; 
 Longtime city critic Ambrose Meletsky spoke at the meeting, asking why the
vote couldn't be taken at council's regularly scheduled meeting and lambasting
council for increasing the city's financial obligation and the term over which
it must be paid. &nbsp;&nbsp;&nbsp; 
 On first reading, the city planned to issue $4.55 million in bonds, but
amended that figure to $3.7 million Thursday. &nbsp;&nbsp;&nbsp; 
 ``We're borrowing less because now that we have been given indications that
we can refinance the pension debt, we no longer expect to have to make an
$865,000 payment on that bond in September,'' Koval said. &nbsp;&nbsp;&nbsp; 
 &nbsp;&nbsp;&nbsp;

W-b Oks Taking $3.7 Million Loan The Move Is Part Of A Plan To Get Its Debts Under Control, Mayor Leighton Says.