JAMESTOWN – City officials don’t believe it will be necessary to have a proposed sale of the city’s Wastewater Treatment plant put to a public vote before being finalized.
That from Jamestown Mayor Sam Teresi, who was a guest on WRFA’s Community Matters program this week and again discussed the proposed sale of the plant from the city to the Jamestown Local Development Corporation (JLDC).
The city is considering the option as a way to bring additional funding to address infrastructure and equipment costs, as well as stabilize property taxes. Through the proposal, the plant – which is located outside of Jamestown in on Quaint Rd. in the Town of Poland and has an estimated value of about $18 million – would be sold by the city to the JLDC. The JLDC would take out bonds in order to pay for the property and, over time, the bonds would be paid off through wastewater rates collected by the Jamestown Board of Public Utilities (BPU). Once the bonding is paid for, the plant would revert back to the possession of the city. As a result, the JLDC would serve as a new “paper owner” of the property, which would continue to remain on the property tax rolls for the Town of Poland, Falconer School District, and Chautauqua County.
Several community members and business leaders have criticized and voiced concerns for the plan, with the Manufacturers Association of the Southern Tier (MAST) coming out and saying it will legally challenge the proposal.
In all, MAST has raised five legal concerns with the proposal. They are:
- The Wastewater System cannot be sold without a majority vote of all residents, per the city charter;
- The Wastewater System cannot be sold while it is still in use;
- The BPU cannot pass through JLDC debt service to system users;
- Users will be charged double for the same system;
- As a lending agency, the JLDC doesn’t have the power to acquire nor bond for the Wastewater System.
Among the concerns expressed is that the city charter states any sale of a city utility system must be approved by a public vote before being finalized. However, Teresi told WRFA that he and the city’s legal council don’t believe that pertains to this specific proposal.
“We do not believe that is accurate at all,” Teresi said. “There is language in the city charter that states that the board of public utilities nor the city council can divest itself of an entire utility system, privatize it, and get out of the business of – saying providing municipal electrical service, sewer service, or water service – and basically to off-line that and cash in on the value of the entire system. In fact, the term ‘utility system’ is actually utilized.”
The mayor further explained that because the proposal involves selling a piece of property and not the entire system, it is precluded from the rules laid out in the city charter.
“It does not apply to individual assets of utility enterprises, like water, sewer, electric, district heating, or garbage. If it did, none of the property sales and asset sales -whether it be equipment, vehicles, buildings, lands – that occurs on a regular basis operating any business, including our own utility operations, would be possible without a referendum of the voters. Clearly that was not the intent of the charter and its not the language of the charter,” Teresi said.
Teresi added that an example of a city utility property sale that took place without the need for a public referendum was the sale of the former BPU electric division property on the corner of Washington and W. Second Streets to the National Comedy Center. That sale was approved two years ago by both the BPU and the city council without need for a public vote.
The mayor said that any proposal to sell the plant would eventually have to be approved by not only the city council and BPU, but also the members of the JLDC board. He added that it will likely take a few more months for that to play out because several different resolutions would have to be approved by the city and related agencies.