Wednesday, January 27, 2010

Another Legislator Involved In A Questionable Non-Profit Deal

House Appropriations Chairman Dwight Evans just added his name to the list of Pennsylvania solonians who started non-profits only to be involved in questionable transactions. According to the Pennsylvania Independent the non-profit bailed out friends and collegues of Evans in a failed nightclub to the tune of $700,000.00.

The Ogontz Avenue Rehabilitation Corp. (OARC) purchased North By Northwest, a Mount Airy nightspot, in March and it has remained closed since. In return, OARC received nothing tangible, not even a state liquor license, according to the Pennsylvania Liquor Control Board.

The initial costs borne by OARC included $400,000 in debt and $169,000 in back taxes on the property that had been leased by the North by Northwest partners. OARC was also saddled with $160,000 rent on the property until the lease expired in October.

Mr. Evans, through a spokesperson, declined to comment on the situation to the Pennsylvania Independent. The woman did say Mr. Evans is not involved in OARC operations. His supporters, however, are.

The North by Northwest partners were Mr. Evans’ longtime protégé Ameenah Young, president of the Pennsylvania Convention Center and first recipient of the Dwight Evans Leadership Award given by OARC; prominent city lawyer Carl Singley and his wife, Rose; Ina Walker, CEO of the New Media Technology Charter School; and Philadelphia attorney Hugh Clark, president of that school.

The school is one of six city charter schools currently under federal investigation for possible misuse of funds and has received $500,000 in state taxpayer money. Mr. Clark and Ms. Walker have been asked to step down from their positions, but have refused to do so thus far.

Just last week SOP reported about Senator Argall's non-profit issue. Of course former Senator Vince Fumo's conviction forced the closing of his non-profit, Citizens' Alliance for Better Neighborhoods, which was a central focus in his trial. Lest we not forget former Representative Michael Veon's trouble with Beaver For Initiative Growth, BIG, a non-profit agency created by Veon.

Should we have applauded Senator Mellow when he wanted to tax the non-profits?? Take it easy...just kidding.

AG Tom Corbett has a Handbook for Charitable Non-Profit Organizations online. One would think that one of these fine legislators would at least take the time to read the damn thing.

Senator Ray Musto To Retire

Ray Musto Citizen's Voice Photo

In a surprise move Senator Ray Musto is retiring from the Senate after 40 years of service to his constituents in the 14th Senate district according to the Times Leader. His term expires in 2010.

You can read more from Senator Musto's press release by clicking here.

"For many years, my wife and family have had to endure long periods when I've been away from home in Harrisburg and they did so without complaint," Musto said.

The veteran lawmaker served in the state House from 1971 to 1980. He began his career when he was elected in a special election in 1971 to fill his late father James Musto's unexpired term. Musto was then elected to Congress in a special election in 1980. In 1982, he was elected to the state Senate. Musto has the distinction of being among only a few public servants to serve in the U.S.Congress, the state House and state Senate.

"My father was an inspiration to me and still is to this day," Musto said. "He taught me the value of hard work, good friends and that in public service you don't have to dislike others because you disagree with them."

"It is my hope that the result of my long years of service is that the northeast and all Pennsylvania will be a better place to live, work and raise a family," Musto said. "I could not have served as long as I have without the support of a loving family, a dedicated and professional staff both in Harrisburg and the district as well as colleagues who listened and appreciated my efforts."

Tidbits From The Valley

As the story goes politics are taking a twisted turn in Luzerne County. One would think that after the FBI walked the halls of the Luzerne County Courthouse and politicians who were viewed as untouchable marched one by one into federal court current office holders would pay attention.

SOP gets the sense that those who were not indicted feel vindicated and out of the sights of the FBI. WOW what an egotistical position for them to assume.

It is rumored that Pittston Mayor Bill Goldsworthy incurred the wrath of Phyllis Mundy at a recent event. It seems Phyllis was less than pleasant after she found out that Mr. Goldsworthy would be seeking her seat in the House of Representatives of Pennsylvania. Less than pleasant...nahhhh.. some said tirade is more like it...well ask Phyllis or those who witnessed the incident.

A former Democrat who wanted to run against the Democrat in her district met stiff opposition from Democrats in the district. So much so that a current Luzerne County Official discouraged her to run, well actually told her not to run. She was so dismayed at the reception by her own party that she decided to switch to Republican and run anyway.

One would think that with all the corruption that has been exposed in Northeastern Pennsylvania Democratic party strategists would chart a new course. They need to lead and show they can put trust back into their party.

Incumbents must soon realize that term limits, if not by law, must be self imposed. Transparency, transparency, transparency. IF they want the FBI to move on, they need to show that business is no longer "the way we always did it."

Tuesday, January 26, 2010

Quite An Indicitment Government's Failure Of Promise To Protect The People

Skrepenak pleads gulity

Jail Guard Charged With DUI Suspended

County Solicitor Investigating Gun Sale Involving Sheriff's Office

Juvenile Cases In Corruption Case Will Not Be Retried

Tweety Bird At The Bonusgate Trial Okayed

Two Luzerne County Prison employees to be laid off

Bonner resigns, Bellas, Emanski plead guilty. And Barack Obama handed out a $25 million no-bid contract for Afghanistan to one of his huge contributors.

Business too big to fail??? Hey Paul Kanjorski how about government that has and is continuing to fail us.

Paulie Boy, how many more jobs in this country than two years ago. Your senority impresses me. 10% unemployment, $1.4 trillion in debt and we need to send you back....WHY?????

Monday, January 25, 2010

Pennsylvania Turnpike Corruption Allegations

Can you imagine that a former finance manager of the Pennsylvania Turnpike Commission would accuse its chiefs or corruption and waste in a lawsuit?

Major focus of the law suit is an apparently rigged procurement and poor performance of CIBER, information technology (IT) consultants out of the Denver area hired at a cost of $82m (to date) to implement a major computer software package called Enterprise Resource Planning (ERP) from the leading German software company SAP.

CIBER's Turnpike boss made campaign contributions during the period of their consultancy to former Pennsylvania state senator Vincent Fumo, currently serving a jail sentence after a conviction in US Court in Philadelphia for corruption.

Last year Pennsylvania Governor Ed Rendell fired Turnpike Commission chairman Mitchell Rubin after the feds said he was the subject of a criminal inquiry. Rubin's wife, Ruth Arnao, an aide to Fumo was convicted along with the former senator on some 40 counts of thievery.

$82 MILLION!!!

For a couple of years there has been press on the wasteless need for the PA Turnpike Commission. Talk in Harrisburg centered on consolidating the Commission, long labled as a political parking lot for oblilgated appointments, into the Department of Transportation.

To compare, PennDOT is run by seven executives and manages more than 41,000 miles of roadway. That equals one executive for every 5,857 miles of state roadway. The Turnpike Commission is run by nine executives and is in charge of 545 miles of roadway. That equals one executive for every 60 miles of roadway on the turnpike. Also, PennDOT uses internal staff to act as government liaisons with the General Assembly, whereas the Turnpike Commission hires contract lobbyists at significant cost.

A Road to Savings: Abolish the Pennsylvania Turnpike Commission from the Commonwealth Foundation

Instead of saving Pennsylvania taxpayers money through measures like abolishing the Turnpike Commission and consolidating its operations with PennDOT, Todd Eachus and the PA legislature decided to take away contractor fees charged by local municipalities and keep them for the state.

It's a bitch when you claim to be the leadership but don't know how to lead.

This Legislature refuses to accept its fiduciary responsibility by continually being a cash eating cow. In this case the PA Legislature is taking the bucks from municipalities to cover our lawmakers' cash eating tracks. Municipalities need to make up that shortfall by taxing its residents so the real reason doesn't look like Harrisburg suffers from "sick legislature syndrome".

In Pennsylvania, for example, the Senate shut down for much of 1993 because the result of a single special election threatened the razor-thin Democratic numerical advantage. Few were surprised by this tactic: The previous year, Republicans had pulled a similar stunt for fear one of their own would switch party allegiance. It is the cutthroat competition for control in a close partisan situation that explains why, during the past decade in Pennsylvania, ethically tainted members from both sides of the aisle have routinely escaped discipline.

Guess they hadn't planned on someone like AG Tom Corbett to come along and call their ass on tainted ethics.

Pennsylvania Ethics Act

§1103. Restricted activities

(a) Conflict of interest.--No public official or public employee shall engage in conduct that constitutes a conflict of interest.

(b) Seeking improper influence.--No person shall offer or give to a public official, public employee or nominee or candidate for public office or a member of his immediate family or a business with which he is associated, anything of monetary value, including a gift, loan, political contribution, reward or promise of future employment based on the offeror's or donor's understanding that the vote, official action or judgment of the public official or public employee or nominee or candidate for public office would be influenced thereby.

(c) Accepting improper influence.--No public official, public employee or nominee or candidate for public office shall solicit or accept anything of monetary value, including a gift, loan, political contribution, reward or promise of future employment based on any understanding of that public official, public employee or nominee that the vote, official action or judgment of the public official or public employee or nominee or candidate for public office would be influenced thereby.

"Gift." Anything which is received without consideration of equal or greater value. The term shall not include a political contribution otherwise reported as required by law or a commercially reasonable loan made in the ordinary course of business.

4. What to File: Filers are required to disclose financial information concerning the prior calendar year. No dollar amounts are required for any of these items except for gifts and certain reportable expense payments/

The information to be disclosed pertains only to the filer and includes:

Gifts: The name and address of each source of gift(s) of $250 or more in the aggregate and the value and circumstances (including a description)of each such gift. Gifts from family members and certain friends are exempt. (A gift is defined as anything that is received without consideration of equal or greater value, excluding (1) political contribution(s) otherwise reportable as required by law; (2) commercially reasonable loan(s) made in the ordinary course of business; or (3) hospitality, transportation or lodging.)

• Transportation, Lodging or Hospitality Expenses:
The name and address of the source and the amount of each payment/reimbursement by the source for actual transportation, lodging or hospitality expenses received in connection with the public position where such payments/reimbursements exceed $650 in an aggregate amount for the reporting year. The filer is not required to report payments/reimbursements made by a governmental body or an organization/association of political subdivisions in which the filer serves in an official capacity. (The term “hospitality” is defined to include meals, beverages, and recreation or entertainment. It does not include gifts, transportation, or lodging.)

Senator Argall In Midst Of Questionable Property Transaction

123-127 E. Broad St. Tamaqua $196,000????

The PA Indedpendent, a public interest service project of the Commonwealth Foundation, is reporting that a nonprofit economic development group started by Senator David Argall was invovled in a property transaction that leaves more questions than answers.

TAMAQUA- A nonprofit, economic development group founded by state Sen. David Argall (R-Schuylkill) and funded primarily with tax dollars, purchased a downtown property for $196,000 last year and sold it to a recent board member of the organization eleven weeks later for $110,000.

The building and a vacant lot at 123-127 E. Broad Street was purchased by the Tamaqua Area Community Partners (TACP) from George Wenzel and Suzanne Krell for $196,000 on July 1 of last year and sold for $110,000 to TKT Miller Partners on Sept. 17.

Micah Gursky, once a senior member of Mr. Argall's Harrisburg staff and now Treasurer and senior principal of Tamaqua Area Community Partners (TACP), said that Todd Miller, a member of TKT Miller Partners, was not a board member of TACP. Mr. Miller was listed as a board member on TACP's federal income tax return for 2008, for the 2008-09 terms of office.

Mr. Gursky said Mr. Miller, a well known area businessman and real estate investor, left the board after his 2008 term.

Mr. Miller, along with his brother and father, is an owner of TKT Miller that owns seven of the nine property parcels in the 100 block of E. Broad St.

Shortly after the TACP purchase of the former bakery and lot, Mr. Gursky told the Tamaqua Times News the transaction was made possible by a $120,000 grant to TACP by the state Department of Community and Economic Development (DCED). The Times News reporter for that story was Joseph Plasko, who is also a member of the TACP board.

This story reminds SOP of the Beaver For Growth Initiative and Michael Veon. Those involved maintain everything in the transactions are legal. Once again they miss that taxpayers don't care if its legal, they care what happened to their money.

Sunday, January 24, 2010

Official: Our Area Is Corrupt

Corruption Rampant in Pennsylvania Coal Country

Sunday, January 24, 2010

Print ShareThisWILKES-BARRE, Pa. — After a six-year run in the NFL, Greg Skrepenak came home to Pennsylvania and parlayed his name recognition and hometown popularity into a seat on the Luzerne County Board of Commissioners.

He'd campaigned as a reformer. It turns out he was anything but. Prosecutors charged him last month with accepting $5,000 in gifts from a developer seeking public financing of a condominium project. He is scheduled to plead guilty on Tuesday.

Another day, another fallen politician in the coal fields of northeastern Pennsylvania, where FBI agents and federal prosecutors have spent the past year rooting out government corruption in a hardscrabble region known for its pay-to-play politics, suspicion of outsiders and resistance to political change.

Twenty-three people in Luzerne County — including a school superintendent, three county judges, four courthouse officials, and five school board members — have been charged so far in a variety of unrelated schemes.

In the most egregious abuse of the public's trust, two judges are charged with taking $2.8 million in kickbacks to place youth offenders in for-profit detention facilities — a scandal known as "kids for cash." While thousands of juvenile convictions have been dismissed by the state Supreme Court, youth advocates say the lives of countless children and their families were ruined.

If I Were Todd Eachus's Handlers This Press Release Would Never Happen

SOP has been very vocal about Todd Eachus's lack of support to help Hazleton and his constituents as part of his partisan politics, not unlike what happens in Harrisburg.

Witness this press release and its wording:

Eachus: Hazleton to receive more than $22,000 in recycling grants

"Hazleton's recycling program is extremely valuable in protecting our environment and keeping our communities healthy and vibrant," Eachus said. "But recycling programs also provide a boost to our local, regional and state economies, contributing thousands of jobs and millions of dollars in economic impact."

In addition to the environmental impact of recycling programs, Eachus said this grant program promotes the growth of recycling in the state, as well as the economic impact the recycling industry provides to the Commonwealth. Pennsylvania’s recycling industry includes more than 3,200 recycling and reuse businesses, and generates $18.4 billion in gross annual sales. It provides jobs for more than 81,000 people statewide.

Eachus said the recycling performance grant was awarded based on Hazleton's population and the total tons of material recycled in 2007. According to the DEP, Hazleton recycled more than 1,600 tons or material last year, which is an increase of more than 60 tons from 2006.

He admits the grant was due to the efforts of Hazleton's compliance. By Eachus's own admission this grant didn't reach Hazleton because of his efforts. He has failed Hazleton due to his partisan politics. He has failed seniors. He has failed the 116th district. His supposed leadership failed to bring a budget on time. It is time he resigns and apologizes to the voters in the 116th. It is time he admits his failures. It is time, Todd.

Pennsylvania Hurts Its Municipalities

In today's Standard Speaker Jim Dino highlights the peril to municipalities from a recent state law that took over licensing of contractors by the Commonwealth. SOP always viewed this law as another money grab by an out of control spending state legislature.

The state's takeover of licensing residential contractors has local municipalities scurrying to change their ordinances because of a loss of revenue.

Prior to this year, municipalities had the option of licensing contractors. Not only did it generate revenue, but it helped residents and municipal officials identify reputable contractors.

The City of Hazleton has lost the most in terms of revenue.

John Ackerman, the city's new public works director, said it has lost $57,300 in fees that 356 contractors paid in 2009 because of the change.

The city had been charging $100 for a license with one trade and $200 for a license with four trades - those used by a general contractor. Plus, the contractor had to buy a $100 business license.

Hazleton like all municipalities is at the mercy of the Pennsylvania legislature when it comes to taxation as a means of revenue. Legislators including Todd Eachus have long ignored their role in the financial crisis these municipalities face.

At the League of Women Voters annual Legislative Breakfast local legislators talked about the need to park partisan politics at the door when they negotiate the Commonwealth's budget.

It is time they park partisan politics when it comes to local municipalities and addressing the needs of the residents they took an oath of office to serve and protect. It is also time that our legislators take on the task of reducing the size of the legislature and/or its staff to shrink the tax impact on Commonwealth residents.

Guilty or not, Bonusgate has taught us how much time the legislative staff spends on campaign work. The investigation not only highlights the waste of taxpayer dollars, it represents the blatant corruption walking the halls of our state Capitol every day. Legislative reform should always be a work in progress. It is time for a serious all out effort.

Saturday, January 23, 2010

In the debate over the possible sale of the water department of the Hazleton City Authority Coatesville, PA has been mentioned due to the sale of its water authority. Here are some comparisions to show the dissimilarities of the two cities.

City Overview

As of 2009, Coatesville's population is 11,614 people. Since 2000, it has had a population growth of 7.32 percent.

The median home cost in Coatesville is $123,220. Home appreciation the last year has been -5.50 percent.

Compared to the rest of the country, Coatesville's cost of living is 3.10% Lower than the U.S. average.

Coatesville public schools spend $6,643 per student. The average school expenditure in the U.S. is $6,058. There are about 15 students per teacher in Coatesville.

The unemployment rate in Coatesville is 6.00 percent(U.S. avg. is 8.50%). Recent job growth is Positive. Coatesville jobs have Increased by 0.70 percent

City Overview

As of 2009, Hazleton's population is 21,867 people. Since 2000, it has had a population growth of -5.54 percent.

The median home cost in Hazleton is $84,870. Home appreciation the last year has been -2.60 percent.

Compared to the rest of the country, Hazleton's cost of living is 22.90% Lower than the U.S. average.

Hazleton public schools spend $6,492 per student. The average school expenditure in the U.S. is $6,058. There are about 21 students per teacher in Hazleton.

The unemployment rate in Hazleton is 13.00 percent(U.S. avg. is 8.50%). Recent job growth is Negative. Hazleton jobs have Decreased by 1.50 percent

Friday, January 22, 2010

Pennsylvania- Debt Disaster

An interactive at this site will glean the following information about the debt disaster in Pennsylvania:

Global Debt Crisis
#35 Pennsylvania
01.20.10, 06:00 PM EST

Forbes Debt Rating (out of 4 stars) **
Debt Per Capita $950
Unfunded Pensions Per Capita $9,825
Moocher Ratio2 54.4%
Moody's Rating Aa2
S&P Rating AA

Governor Edward Rendell
Gross State Product $435 bil
Population 12,500,000
Average annual net migration 12,600

Net tax-supported debt (2008) $11.8 bil
Debt as % of personal income 2.5%
Debt as % of Gross State Product 2.7%
State tax revenue (last 12-mos) $29.6 bil
State tax revenue change (last 12-mos) -7.5%
State and local general revenue (2007) $93 bil

Unemployment (2010) 9.7%
Job growth* 1.3%
Income growth* 1.6%
Gross State Product growth* 3.1%
Population growth* 0.1%

When are the voters going to wake up and throw out the persons in charge who caused this problem?



HARRISBURG OFFICE (717) 231-3400

HARRISBURG OFFICE (717) 221-2270
SCRANTON OFFICE (570) 496-1020
ALLENTOWN OFFICE (610) 770-0940


HARRISBURG OFFICE (717) 232-8686
SCRANTON OFFICE (570) 344-2404
ALLENTOWN OFFICE (610) 433-6488

HARRISBURG OFFICE (717) 221-4425

HARRISBURG OFFICE (717) 221-4476


HARRISBURG OFFICE (717) 221-4550
SCRANTON OFFICE (570) 961-4492

HARRISBURG OFFICE (717) 221-2212
SCRANTON OFFICE (570) 346-7277

HARRISBURG OFFICE (717) 257-2330
SCRANTON OFFICE (570) 969-5161

HARRISBURG OFFICE (717) 234-0214
SCRANTON OFFICE (570) 346-5781

FRAUD - WASTE - ABUSE LINE (800) 488-8244

If you see it report it.

Wednesday, January 20, 2010

Mike Veon's Juror List Growing

Log into Tracie Mauriello Twitter Tweets about the Mike Veon Trial

Tracie Mauriello of the Post-Gazette in Pittsburgh is covering the progress made in the Mike Veon "Bonusgate" corruption trial. In this story she tell us that 10 jurors have been picked so far.

HARRISBURG -- Four more jurors were picked this morning for the government corruption trial of former Beaver County state Rep. Mike Veon and three former aides, bringing the total to 10.

Selection continues this afternoon with the goal of finding two more jurors and at least four alternates.

All four defendants are former high-ranking officials or employees of the House Democratic caucus.

Of the 10 jurors selected so far, only one is a registered Democrat.

The defendants are Mr. Veon, 53, and his former aides Stephen Keefer, 39, of Fredericksburg; Annamarie Perretta-Rosepink, 47, of Beaver Falls; and Brett Cott, 37, of Harrisburg.

All are charged with theft, conspiracy and conflict of interest. Mr. Veon faces a total of 56 counts, Mr. Keefer 16 counts, Ms. Perretta-Rosepink 22 and Mr. Cott 42.

The defendants also are accused of using state equipment and state employees' time for political work. They are charged with multiple counts of theft, conflict of interest and conspiracy for allegedly using $1.3 million in public money and state resources to run political campaigns between 2001 and 2006.

Testimony is expected to begin Feb. 1 in Dauphin County Common Pleas Court.

Opps eight minutes ago Tracie tweeted

pgpolitweets 11th juror selected is an LPN at Hershey Medical Center. She is the 2nd Democrat seated. #bonusgate 8 minutes ago reply

Keep in mind that Tweets are updated at will so even this post may be behind. Enjoy.

Corrupt Receipt Of A Reward For Official Action

That's the charge an authority member and businessman plead guilty to yesterday in a Scranton federal court. Jennifer Learn-Andes writes in the Times Leader

Former Luzerne County Redevelopment Authority Director Allen Bellas and area business owner Richard Emanski both pleaded guilty in federal court in Scranton Tuesday on unrelated charges connected to the ongoing corruption probe.

Bellas, 60, of Kingston, pleaded to corrupt receipt of a reward for official action. Emanski, 66, of Harveys Lake, pleaded to corrupt payment of a reward for official action.

Bellas acknowledged that he accepted $2,000 from a construction contractor in 2008 in exchange for helping the contractor secure approval of a program that funds some development costs.

SOP wonders out loud how many more authorities should be investigated for similar crimes. Stay tuned.

Tuesday, January 19, 2010

Kanjorski- Let The Games Begin

If Paul Kanjorski isn't paying attention he should.

Home // News Tuesday, January 19, 2010 10:58 pm

Updated: 10:49 PM

In epic upset, GOP's Brown wins Mass. Senate race
GLEN JOHNSON,Associated Press Writers LIZ SIDOTI,Associated Press Writers

Paul Kanjorski- When Are You Going To Pay Back The Money

Ooopps..that headline is a few years old. It was the "Cornerstone" of a campaign gone by. But seriously folks you have to hand it to Paul "Strum My Banjo" Kanjo.

In Kanjo's latest misdirection to the voters Borys Krawczeniuk at the Times Tribune pens this headline "Kanjorski: Big banks should understand new tax from government that bailed them out".

Let's get this straight, Paul. No government bailed them out. The citizens of the United States bailed them out. The government gave them our money, which by the way, you didn't have in the first place to give witness the balloon in the deficit.

Secondly the banks paid interest on every penny that was given to them. Even when they wanted to pay it back your fearless leader, "I have not a clue how to govern Obama" blatantly refused to allow them to pay their money back.

Obama now flip flops, stands in front of a camera, panders to the public and states "We Want Our Money Back." signaling his continued populist rhetoric that is quickly becoming old hat.

Here is the consequence to Kanjo's constituents if this tax passes.

Showing a clearer understanding of basic economics than the White House, JP Morgan Chase's CEO Jamie Dimon, Wall Street's most frequent White House visitor, called the tax a "bad idea." He added, that the businesses wouldn't really pay the fees anyhow."All businesses tend to pass their costs on to customers."

Harvard's senior economics lecturer Jeffrey Miron reinforced that point in Investor's Business Daily. Miron said "higher taxes mean higher costs and therefore higher prices, so customers (borrowers) will bear some of the burden of the tax." Fees, less available credit or companies shifting operations to other countries are all possible costs to customers as a result of a bank tax.

Then of course there's the fact that the tax is completely unfair, a point some reporters asked the White House about. CBS's Chip Reid asked Gibbs if it is "fair" that the tax could hit non-TARP banks or banks that have already repaid the money.

"There are obviously a lot of other banks that were TARP banks and paid their money back. Why is it fair to now go after them if they've paid the money back?" Reid asked.

Gibbs replied "Because of what they caused this economy." When Reid rightly suggested that's "punishment," Gibbs denied it.

The tax will only fall on the 50 largest banks and A.I.G. to "recoup" TARP losses, but some of those losses have been incurred by companies exempt from the tax including union shops General Motors and Chrysler and government-sponsored enterprises Fannie Mae and Freddie Mac.

Despite White House rhetoric blaming the entire financial crisis on Wall Street, many fault the extreme overleveraging at Fannie Mae and Freddie Mac as well as their majority ownership of the secondary mortgage market for spurring the foreclosure crisis which rippled through the entire U.S. economy. you recall you refuse to exercise control and oversight over Fannie Mae and Freddie Mac during testimony from the Financial Services Roundtable Steve Barlett? Kanjo, your memory may be failing but ours is fresh and ready to expose your misdirections every time they happen.

Monday, January 18, 2010

Luzerne County Tax Office - FBI Visits Again

According to Fox56 news tonight the FBI was back in the tax claim bureau of Luzerne County requesting records of those who owe back taxes but weren't placed on the tax sale notices as required.

American Water Works History Involves Hazleton City Authority

American Water Works Company, Inc. is the largest investor-owned water supply company in the United States. With 25 utility subsidiaries operating in 23 states, the massive utility company services more than 1,000 communities nationwide and has served more than ten million customers through its 300 water production facilities. Bringing water to residential, commercial, industrial, and public clients, American Water Works continues to broaden both the size and scope of its business through acquisitions and construction projects to ensure its viability in the 21st century and beyond.

John H. Ware, Jr., was an eighth grade dropout and self-made millionaire who, during the 1930s, had begun acquiring small U.S. water utilities. While much of the country was still struggling from the devastation of the Great Depression, Ware had managed to amass a small fortune. He was particularly interested in one of President Franklin D. Roosevelt's New Deal policies, the Public Utility Holding Act of 1935, which required that multilayered holding companies owning or operating utilities be broken up into smaller, independent companies. Among those targeted was the American Water Works & Electric Company, a prime example of the type of company the 1935 law was intended to abolish. Originally founded in 1886 as the American Water Works and Guarantee Company, the company was renamed in 1917 as American Water Works & Electric and owned several utility operating companies in western Pennsylvania, West Virginia, Maryland, and Virginia, and about 80 local water companies in the eastern, southern, and Midwestern states.

Ware was determined to add the water utility assets of American Water Works & Electric to his expanding empire. The company unsuccessfully lobbied the Roosevelt administration to fight the Public Utility Holding Act of 1935, but the act was passed by Congress and signed into law. American Water Works and Guarantee then joined with the North American Company, another huge public utility holding company, in an action before the U.S. Supreme Court to have the law declared unconstitutional. The suit notwithstanding, American Water Works & Electric was the first utility holding company to file a plan of reorganization with the federal government, as the law required. As it was approved in 1937, the plan called for a simple reorganization to reduce its layers and required the company to divest itself of real estate holdings in California. The reorganization was to cost about $60 million and was viewed as a milestone when approved by the U.S. Securities and Exchange Commission, because it demonstrated that the federal regulatory agency could act benevolently when utility holding companies cooperated.

Despite complying with the restructuring and divestment plan, the company, newly renamed American Water Works Company, Inc., bitterly fought in the courts for the next nine years. The end came in 1946 when the Supreme Court found that the 11-year-old Public Utility Holding Act Law was, indeed, constitutional. The same year, American Water Works was forced to revise its reorganization plan when it realized that its inability to pay stock dividends for the previous eight years would make the investment community reluctant to put its money into the company. The reorganization plan had the company selling its cash cow, its water works business, to finance the restructuring. The company's management thought that its existing shareholders would bid on the company's stock through sealed bids and nothing would change; they also expected its stock to be sold at $10 or more a share in the sealed bidding process.

Ware, meanwhile, had been waiting in the wings and raising funds. He had not only pursued his interest in buying water companies, but had invested in a series of successful smaller ventures, including several electrical contracting companies, and had been able to raise $13 million in capital. Although an unknown entity to American Water Works' managers, Ware submitted the only bid for the company, at $8 per share. He invested the entire $13 million and won a company with assets of $183 million, though some of the company's water works facilities and pipelines were broken down and decrepit. The once mighty holding company had become an aging vestige of a bygone era; American Water Works, with operating revenues of $24 million for the year, joined Ware's burgeoning resources with little fanfare in 1947.

The previous managers at American Water Works left with Ware's purchase of the company, and he brought in his own management team, including Lawrence T. (Bill) Reinicker and John J. (Jack) Barr. Reinicker was skilled as an operations manager, and Barr was Ware's financial expert. Both had joined Ware in his earlier ventures in the late 1930s and had been named vice-presidents. The company Ware, Reinicker, and Barr took over included electrical utilities, but Ware was primarily interested in the water utility operating units. He bid on the entire company to gain a 51 percent ownership share when his financial advisers warned that his $13 million in cash would not be enough to buy the company or its water works assets outright, and he consolidated his ownership in the ensuing years. Within a few years Ware spun off the electrical power business.

The company moved six times in the eight years between 1942 and 1950, to various office buildings in New York City, in Camden, New Jersey, and back to New York City, before finally moving to new headquarters at Three Penn Center in Philadelphia in 1955, where it remained for the next 21 years.

Ware bought and sold smaller water companies at a fast pace during his first few years of owning American Water Works Company. Where cities wanted to own and operate their own water systems, he divested, sometimes after bitter feuds; where municipal utility operations were too small to grow or to remain afloat on their own, he acquired them, and, where new projects were needed, Ware stepped in with his company's deep financial pockets to establish viable water systems.

Ware scored a major coup in 1948 when he contracted to build a dam and reservoir on the Occoquan River in Alexandria, Virginia. The huge project also called for pumping and treatment stations, but before the ink was dry American Water Works found itself in another bitterly contested court fight. In a move proving all too common, the city wanted to acquire the Alexandria water company and operate it as a community-owned utility. This spurred the court actions, which ended with Ware's loss of the Alexandria system after a protracted legal battle. Despite the legal wrangles, American Water Works, with its economy of scale and Ware's inimitable drive, was able to afford the costly improvements and maintenance of water systems taxed by the growing demands of development in the United States' boom years.

In the executive offices, Bill Reinicker had been named president in 1953 and vice-chairman in 1954; he retired at the age of 61 in 1955. When Reinicker became vice-chairman, Jack Barr was named president of the company and effectively became its CEO and COO, while Ware continued as chairman. Barr oversaw the company's growth through the turbulence of the 1960s, a period when American Water Works continued its acquisitions of smaller companies while spending huge amounts of money to renovate and build new water treatment, pumping, and storage facilities. It was in 1963 that American Water Works and Ware's company, Northeastern Water Company, officially merged into one nationwide utility giant. The new company's size and clout helped make possible one of its largest acquisitions, that of International Utilities (later known as UI International), another sizable water utility operating company.

The dawn of the 1970s brought a new era of environmental awareness and, along with it, increasing environmental legislation. In 1975 Barr retired and was succeeded as president by John A. Gubanich. Ware, too, retired as chairman of the company and his son, John H. Ware III, became chairman. Gubanich, former treasurer of the company, was given credit for greatly increasing the company's profit throughout the decade. During his eight-year term as president of the company, Gubanich continued consolidating the company's smaller water companies, installing a uniform and centralized management system and merging many of the smaller companies into larger, regional operations. By the end of Gubanich's presidential term, American Water Works Company had only 33 operating units, a drastic reduction from the 151 companies the company had owned or acquired since its founding.

The stagnant growth and high inflation of the late 1970s left the company strapped for cash. To meet the challenge, Gubanich ushered in a series of cost-cutting moves that included merging several operating units and relocating, in 1976, the corporation's headquarters from Philadelphia to Voorhees, New Jersey. Gubanich also worked to broaden the American Water Works board to include outside directors, bringing in a fresh perspective and business acumen previously lacking. One of these new directors was Philadelphia banker Sam Ballam, who became the first outside chief executive of the company in 1984 when he replaced the retiring John Ware III as chairman of the board. At the same time, Gubanich was succeeded by James V. LaFrankie as president of the company. LaFrankie had been with American Water Works Company almost from the day John Ware bought it, and he rose through the ranks of various operating units. LaFrankie was the first president of the company from the operations side since Bill Reinicker, and he continued the Herculean task of consolidating the company's dozens of operating units.

Marilyn Ware Lewis, daughter of John Ware III and granddaughter of John Ware, Jr., was named chairman of American Water Works Company, Inc. in 1987. In a 1989 interview with the Lancaster (Pennsylvania) New Era, she recalled that when she was a little girl her grandfather had told her the availability of water would be one of the most significant issues faced by her generation. Lewis was convinced at an early age that water was the single most essential commodity in a household and she, like her grandfather, had come to believe a company that efficiently treated and supplied clean drinking water to its customers would be a very profitable enterprise. She was right: as the 1980s came to a close American Water Works Company's utility subsidiaries crisscrossed the country. By 1989 operating revenues had reached $528 million, with the company having sold more than 211 million gallons of water to 1.5 million customers in the residential, commercial, industrial, and public sectors.

The last decade of the 20th century brought further expansion for American Water Works in the Midwest, as well as on both the East and West Coasts. The earliest years, 1990 and 1991, saw unprecedented growth, with operating revenues climbing from $573 million to $636 million and income leaping 30 percent to $74 million. Much of the increase in revenue and income came from the company's widening scope within the wastewater treatment sector, led by new President and CEO George W. Johnstone, who had been with the company for 25 years. A new water carbon regeneration plant was in operation in Columbus, Ohio, supplying filtered water to other subsidiaries as well as nonaffiliated companies; this was followed by a joint venture in 1993 with the United Kingdom's Anglian Water Plc to form AmericanAnglian Environmental Technologies (AAET), as an advisor to wastewater treatment plants offering both technical and financial aid. Other acquisitions during the year included water utility companies in Indiana, Michigan, Missouri, and Ohio.

In addition to buying utility holdings throughout the United States, American Water Works maintained its edge by extensive renovations to its subsidiaries as well as undertaking massive building projects. One such plan was the $200 million Tri-County Water Supply Project to augment the existing New Jersey water supply by tapping into the Delaware River; another included adding 26 miles of new pipeline and a wastewater treatment plant to its West Virginia utility. By 1995 the company's expansion projects were forging ahead to the tune of more than $331 million invested for that year alone and operating revenues at year end were a robust $803 million. In addition, American Water Works executives were delighted when the company was included in Standard & Poor's well-known MidCap 400 Index.

In 1996 the New Jersey/Delaware River project was completed and put into use while the company's Pennsylvania unit executed the industry's largest asset acquisition, for $409 million, to buy Pennsylvania Gas and Water Company's water holdings, supplying water to Scranton, Wilkes-Barre, and the surrounding areas. American Water Works Company's utility assets, spread over 21 states, were now worth more than $3.4 billion, and operating revenues had climbed to $895 million. The next year, 1997, marked the end of an era as John Ware III passed away and the company's president and CEO, George W. Johnstone, retired after more than three decades of service. Taking the helm as CEO was J. James Barr, who had been CFO since the beginning of the decade, and who had held various executive positions in the interim. Marilyn Ware Lewis continued as chairman of the board.

A new kind of history began in 1998 when American Water Works broke the billion dollar mark with operating revenues of $1.02 billion. The United States' largest regulated water utility business was not content to rest on its laurels; during the last two years of the century came several sizable acquisitions, including National Enterprises Inc. (for $458 million), SJW Corp. ($390 million), and the water and wastewater assets of Citizens Utilities Company ($745 million). The company's joint venture with Anglian Water Plc, however, had not lived up to expectations. In an effort to salvage the operation, American Water Works bought out Anglian's interest and restructured AAET into a new company. Operating revenues for 1999 surpassed $1.26 billion, while stock performance ranged from a low of $17 to a high of more than $34 per share.

Whereas American Water Works Company's predecessor was broken up by the Public Utilities Act of 1935 because of its size and stranglehold on the market, the younger behemoth followed in the footsteps of its elder. Although regulated and publicly owned, American Water Works certainly dominated its market, operating two dozen subsidiaries throughout the United States in 23 states, producing some 345 billion gallons of water in 1999 to serve more than ten million customers. The company's weakness, however, was none other than its client base, which had proven fickle throughout its colorful history. As had happened time and again, communities large and small often decided to obtain and supply their own water; these demands were generally settled in court. American Water Works had had more than its share of legal skirmishes, and to keep its customers happy, had invested millions of dollars to maintain what it touted as the best water utilities and treatment plants in the nation. With the EPA projecting upgrades and maintenance of the nation's more than 50,000 water systems costing upward of $1.35 billion during the next two decades, American Water Works was already way ahead in the game. In 2000 and beyond, the company's continued prosperity was a relatively safe bet, and customer service was given a higher priority with plans for a new national service facility to open in Alton, Illinois, in 2001.

Principal Subsidiaries

American Commonwealth Management Services Company; Arizona-American Water Company; California-American Water Company; Connecticut-American Water Company; Hampton Water Works Company; Hawaii-American Water Company; Illinois-American Water Company; Indiana-American Water Company; Iowa-American Water Company; Kentucky-American Water Company; Long Island-American Water Company; Maryland-American Water Company; Massachusetts-American Water Company; Michigan-American Water Company; New Jersey-American Water Company; New Mexico-American Water Company; New York-American Water Company; Ohio-American Water Company; Pennsylvania-American Water Company; St. Louis County Water Company and Missouri-American Water Company; Salisbury Water Supply Company; Tennessee-American Water Company; Virginia-American Water Company; West Virginia-American Water Company.

American Thinker Blog: Obama-Coakley rally can't fill hall; president heckled

American Thinker Blog: Obama-Coakley rally can't fill hall; president heckled

Over a 1,000 people couldn't get into Brown's rally. According to those up in the Valley the Repbulicans are dead in the water...hmmmmmm

Sunday, January 17, 2010

Oh It May Be Warmer Here But The Heat In Harrisburg Is Flaming!!

As the Brett Coptt Bonusgate trial is about to start a defense lawyer decided that loud and profane outbursts would get him top billing on the net...he was right.

By MARK SCOLFORO,Associated Press Writer

HARRISBURG, Pa. (AP) — A defense lawyer in the Pennsylvania legislative corruption trial launched a loud and profane outburst against a state prosecutor in a Dauphin County courtroom Friday, shortly after a daylong pretrial hearing had ended.

Bryan Walk, who represents former House Democratic aide Brett Cott, accused Senior Deputy Attorney General Patrick Blessington of violating rules for lawyer conduct by encouraging one of Walk's other clients to hire a different lawyer.

Walk said the exchange began when Blessington came up to him and told Walk he should talk to that other client, but it drew attention among the 30 or so people in the courtroom when Walk told him loudly to "get out of my face."

"I don't know who the (expletive) you think you are," Walk said to him. Blessington's only visible reaction was to yawn widely.

Kevin Harley, a spokesman for the attorney general's office, said the accusation against Blessington was untrue.

"It appears that by attorney Walk's inappropriate outburst that he has an anger management problem," Harley said.

Michael Veon wants to tee-up Bill DeWeese as a witness in his trial which will start this week barring a negative ruling on the admissability of emails by the prosecution.

By Brad Bumsted
Saturday, January 16, 2010

HARRISBURG -- An attorney for former Democratic Whip Mike Veon said Friday he intends to call former House Speaker Bill DeWeese as a witness at Veon's trial and suggested DeWeese was a leading co-conspirator in the legislative bonus scandal.

"If crimes were committed, not only is Mr. DeWeese a co-conspirator, he's the king," said Dan Raynak, Veon's lawyer. Raynak said he didn't know whether DeWeese, D-Waynesburg, would invoke his Fifth Amendment right not to testify.

Guess we won't have to wait for summer to see things heat up in Harrisburg.

What Is Wrong With Our Judiciary??

If the fiasco with Ann Lokuta and Richard Sprague isn't enough to warrant a full scale explanation..witness this unbelievable fiasco involving the judge sent to take Michael T. Toole's place as reported by the Citizen's Voice.

Senior Judge C. Joseph Rehkamp, 61, faces charges of simple assault and harassment. Rehkamp allegedly got into a verbal argument with his wife Valerie on Saturday around 8:34 p.m. in their Plymouth Township home, state police at Wyoming report.

The argument turned physical, and police said Rehkamp pushed the victim down, slamming her into a chair, then placed both hands on her neck and began choking her until a third party interrupted. Rehkamp then fled the scene.

Property Tax Effect On Hazleton Property Owners

The media has lost focus in the debate over the proposed sale of the water department under the governing of the Hazleton City Authority. Before they talk whether it should or should not be sold the question of "WHY" needs to be addressed.

When Mayor Lou Barletta proposed his plan he DIDN'T WANT to sell the water department; he proposed it as a possible SOLUTION to the financial crisis facing the City of Hazleton.   What is the consequence if the City does not sell the water department to Hazleton taxpayers?

For two years he was asking Hazleton's City Council for ideas and ways to bridge a continual gap between income and expenses.  No plan was brought to the table.  He felt the need to propose his plan before the City reached the point of no return.  Political pundits have distracted the taxpayers from the reason behind his plan and are trying to gain focus on the water department as a means of pushing their political agenda.

The City of Hazleton has unpaid bills and debts owed to the tune of over $3,100,000.00, around 3.5 mills in additional taxation over and above the 70% increase in taxes for 2010. The Mayor and City Council debated long and hard about department cuts and what was in the best interests of its citizens. Debate over police cuts were furious but in the end police protection was paramount to the wants and needs of its citizens, business owners, and the public at large, rightfully so.

Hazleton taxpayers must face the fact that decades of stagnant revenues due to a millage cap of 25 mills by Pennsylvania law was the precipitating factor leading to this "perfect storm". Rising health insurance costs, pension costs, employee salaries, heat, light(the city pays for every street light) and fuels costs coupled with declining property tax revenues, a steep decline in Emergency Municipal Services Tax revenue, and stagnant mercantile and business privilege taxes in a severe overall economic decline not only nationally but globally brought Hazleton to this point. Hazleton is not alone by any means. Municipalities across the state and the nation are in financial dilemmas.

In the calculations on the slide above SOP added the additional property tax millage needed to bare bones fund the budget to the base year of 2009. For 2010 Hazleton City Council already announce a property tax millage rate of 2.38. In order to erase the $3.1 million dollar deficit another 3.5 mills would be needed in 2011 plus the funding for any income shortfalls.

At the present time the City's budget is approximately $1.5 million short in revenues vs. expenses. That figure must be added to the defict erasing millage to set the correct millage needed for 2011 and each year after that assuming no change. That figure would be a staggering 7.6 mills or $744.80 per $100,000.00 assessment for 2011. An additional 1.67 mills would be needed every year thereafter to make up for the $1.5 million dollar shortfall assuming no inflationary pressures and the same income vs. expense stream.

For 2012 the tax rate would be 9.27, 2013 would be 10.94, and 2014 would be 12.61. For year 2014 Hazleton taxpayers would be paying an unbearable burden of $1236.00 per $100,000.00 per year. For a property owner with a $200,000.00 assessment that tab would be $2,472.00 just for Hazleton property taxes.

None of those figures include any amount for debt service which is represented on the bar to the right of the millage for the corresponding year.

What started out as $233.00 per $100,000.00 of property assessed value will balloon to $1236.00 in just four years. Those who complain about the effect of increased water rates on seniors are not being honest with the real impact those on limited incomes face without the sale of the Water Deparment at this point.

In contrast the average residential water bill according to HCA audit figures is $34.43 per month. If those rates increased by even 30% the bill would only rise to $44.76 per month. The total increase would amount to $124.00 per year and property tax rates would remain stable due to the interest income from the irrevocable trust created with the net proceeds of such a sale funding the unfunded expenses in the budget.

The benefit to those customers not living within the boundaries of Hazleton City would be the increased property tax revenue to their respective municipalities when tax-exempt properties are placed back on the tax books due to ownership by a private entity, not a tax-exempt body.

In the case of providing water service to Pardeesville residents alone the audit for 2009 demonstrates that the loans, not the total cost, borne by the Hazleton City Authority for that project amounted to $7,106.00 per customer for a total of $568,543.00. The project was funded in 2000.

The water revenue bond for that project will mature in 2033. HCA asked for an extension of their life which should have ended in 1988 according to the Municipal Authorities Act to 2043. If their bonds end in 2033 according to their audit the question remains for the necessity to extend life to 2043. Where the Board Members forthright in their request?

If Hazleton taxpayers don't want the sale of the water department another solution must make it to the table. Dr. David Sosar was quoted "There has got to be a better way to do this." In another article by Mia Light of the Standard Speaker she writes Director David Sosar urged any citizen with a viable idea to step up and make their voice heard. Even Dr. Sosar admits he doesn't have the answer. If he does then Dr. Sosar and anyone else should propose it to the Mayor and City Council.

Until those ideas emerge here is a chart of the property tax stability that will occur if the water department is sold and the proceeds are put in an irrevocable trust. Property taxes would remain stable while water ratepayers will only experience a small increase in water rates. Inflationary pressures are devoid of the figures in the chart above but that is the case for the chart below as well.

Obviously a steady rate of 2.38 mills would be the preferable option to 12.61 mills. It would be hard to make the case that the P.U.C. would allow a 30% increase in water rates by 2014 if they are frozen for the next two or three years.

What should not be lost is the emotional toll and the prospect facing HCA Water Department employees in such a transition. Mayor Barletta has been clear about the need to preserve their jobs and preserve the jobs of Hazleton employees. If one entity loses jobs to the other there would be no net gain. Obviously, even to the novice, that wouldn't be acceptable. As far as the rate increase goes this quote says it all. Witness Mayor Barletta's committment.

"We want to make sure there is a rate freeze for a number of years. Second, we want to make sure the employees are retained," Barletta said in an interview on Thursday.

Unlike the Pennsylvania legislature that promised us reduced school property taxes here is a plan that will make property tax reduction happen, reduce the burden on those with fixed income, and preserve jobs.

One must not lose sight of the fact that American Water operated and controlled the operations of the water department of the HCA from 1943 until 2006. When the majority of the board makes comments about keeping safe, clean drinking water they are less than disingenuous. American Water has a history of keeping safe, clean drinking water in this area for approximately 63 years. Aqua American dates back to 1886. The oldest serving Board Member has only been there for 18 years, hardly a track record to hang a hat on. But be mindful 18 years can be too long for anyone who is so entrenched that the public as a consideration is not the real reason.

Thursday, January 14, 2010

Todd Eachus- It's One Year Later, Same Question

One year ago today Eric Epstein penned the following article. It's worth posting because the last question still stands.

Todd Eachus: New boss, same magic tricks
By Eric Epstein
1/14/2009 - 11:24:24 AM

On Monday, the Pennsylvania Legislature's "new" majority leader, Todd Eachus, announced that the House of Representatives was under "new management." The same day, the "new" majority whip, Bill DeWeese, introduced HB 21 to promote table games at Pennsylvania casinos. The next day, Dan Surra, former majority caucus administrator, landed a "new" job during a hiring freeze.

Alakazamm! Whoosh! Everything is fine.

Wait a minute. I think we've seen this magic act before.

Who is the new magician?

Eachus voted to increase his salary 22 percent from $69,648 to $85,102, defended the pay grab and kept the money. Mr. New Management never paid back the unconstitutional pay raise.

Eachus is a protégée of indicted former Whip Mike Veon. In fact, it was Mr. New Management who retired Veon's campaign debt. "Mike's contribution as a leader to our collective effort meant a lot to us," said House Majority Policy Chairman Eachus of Luzerne County, who chairs the campaign committee. But the committee's other three leaders -- Reps. Joe Preston, Dan Frankel and Jennifer Mann -- apparently had no knowledge of the two payments.

Last year at this time, Eachus told the public there was no need for new management. "The pay-raise thing, I think, is finally behind us. I think we're on to other issues now."

Eachus' first move was to hire Chris Casey to conduct a management review. Casey will be paid from the same unaudited non-lapsing accounts that just paid Bill Chadwick to eliminate waste and inefficiencies.

Chadwick Associates was hired in March 2007 by DeWeese to advise the House Democratic caucus on legal and ethical issues. What did the taxpayers get for the $833,000 Chadwick's firm received?

OK, so now we move from paying for advice to paying for an audit from a partisan politician.

Who's going to audit Casey's expenses? Will the latest ethics guy have the authority to audit $200 million in slush funds?

However, the first order of business for Casey is to ask one question: "Mr. Eachus, when are you going to pay back the money my brother said you took illegally?"

Eric Epstein is a watchdog and advocate for consumers, good government and safe energy. For more about Epstein, click here.

Luzerne County Prothonotary Employee Terminated

As previously reported Luzerne County's Prothonotary Office was missing funds. Jennifer Learn-Andes of the Times Leader is reporting that Luzerne County Prothonotary Carolee Medico Olenginski has terminated clerk Pamela Yanac. Evidently she confessed to taking the missing funds from the office. Up to this point Yanac was suspended without pay since December 18th so today's action probably wasn't a shocker.

Are Deakos' Garbage Figures "Garbage"?

At last night's Hazleton City Council meeting self-proclaimed taxpayer watchdog Dee Deakos produced "her" research regarding the impact of Hazleton's increase in its garbage fee to Hazleton residents.

According to this article written by Steve Mocarsky of the Times Leader Dee Deakos, a political foe of Barletta and a member of the Hazleton Taxpayers Association, said her research shows that the increase will result in about $361,000 in extra revenue beyond the actual cost of garbage collection.

An examination of the entire garbage situation in Hazleton will paint a much different picture than Dee's presentation.

Hazleton's contract with Mascaro & Sons commenced in 2008. It is a five year deal worth approximately $10 million dollars to J.P. Mascaro & Sons.

For the year 2010 the actual price is $2,002,620.00. However one must add the cost of mailing and collecting the garbage fee contracted to Don Wilkinson and Son which is about $45,000.00. Therefore the total cost to Hazleton is $2,047,620. If one divides that amount by the number of household units served of 10,300 the cost per unit is $198.80.

According to Mocarsky's article the current fee is $204.00 which, on the surface sounds about right. The new fee passed by Hazleton's City Council raises that fee to $240.00.

What Deakos didn't present in her argument was the correct figure for bad debt. It is curious that she had all the other figures in her research but "assumed" a 5% bad debt figure in her analysis.

The real figure for last year was $513,000.00 in bad debt or approximately 25%, not five percent.

Deakos proffered to the crowd that the increased fee would result in an extra $361,000.00 beyond what the contract cost. Looking at what the contract cost vs. what is the reality of fee collection paints a much different picture. The increase fails to cover all of the cost of the bad debt, thus the payment the city makes and is obligated to pay to Mascaro.

As of this date the City of Hazleton owes Mascaro approixmately $500,000.00 in unpaid contractural monies. If one adds the bad debt of $513,000.00 plus the $500,000.00 the City is behind over $1 million dollars in its garbage budget line item. It is very clear that $361,000.00 will not erase that shortfall.

On the issue of bad debt, it is SOP's Opinion that Wilkinson failed miserably to properly collect the fee as well as deliquent accounts. Just last week the City of Hazleton turned over the deliquent accounts to a collection agency. Even if the agency is 100% successful that amount collected cannot help this year's garbage fee as it is needed to erase the shortfall of $1 million.

SOP is not unaware of the impact to seniors and low-income households with such an increase. That assessment takes SOP back to the sale of the HCA. If that sale proceeds to fruition the hike in property taxes as well as the garbage fees will more than likely be rolled back to previous levels.

If you want to read a study about the "Evaluating Solid Waste Collection Options" click on this link to the New York State Office of the State Comptroller. The present system employed by the City of Hazleton to contract for refuse collection as a means of cost savings is validated on that site.

Tuesday, January 12, 2010

McCall Announces His Retirement After Eachus Announces Re-election Bid

Does anyone see the humor in that? They certainly weren't Bogie and BaCall but then again there was only one couple who can claim that relationship. They are more like Mr. Peabody and Sherman.

This headline probably sums up in words what most mainstream media are afraid to print.

Eachus’ aide and McCall’s chief counsel indicted
1, July 10, 2008 ·

"Horse with blinders" usually isn't a good defense for the top person in the office. In private industry the buck stops at the top not the bottom.

To be fair McCall's Chief Counsel was found not guilty. How many of you reading this blog have even been put into a situation where you were arrested or invited to tell your story before the grand jury?

Picture courtesy of PA Fraternal Order of Police Lodge No. 38

Beat's Macy's Parade doesn't it?

Noah Couldn't Build An Ark Big Enough To Navigate This Sea of Corruption

Although today's Standard Speaker did not report it the Times Leader chronicled Todd Eachus's audacity to make these statements surrounding the Bonusgate investigation.

Eachus declined to say if he thinks state Attorney General Tom Corbett’s investigation into the House Democratic Caucus and the illegal award of bonuses to state workers for campaign work might affect his chances at re-election.

“It’s been a serious investigation, and the House Democratic Caucus has taken it seriously. But I think you’ll note from my comments all year that I have not commented directly on this investigation. And as difficult as that is, because I think people know me, I’m extremely direct, no one should be commenting on a grand jury investigation,” Eachus said.

“Because as (House) leader I’ve managed the entire investigation from Harrisburg, it’s not appropriate for me to comment,” he said.

No, Todd, you "managed" to get into the middle of the Bonusgate by an invitation to speak before the grand jury empanelled in the probe. If memory serves SOP correct AG Tom Corbett is MANAGING the Bonusgate probe, not you.

From the Philadelphia Inquirer, this editorial demonstrates that Todd Eachus should have more pride in the district he represents and decide not to run again rather than his bold move to announce he will run. Obviously this do-nothing legislator has no other options but to keep sucking at the taxpayer tit as a means of earning a living.

Monday, January 11, 2010
'Bonusgate' floated on sea of corruption

The guilty pleas of top legislative aides in Harrisburg have erased any doubt that a widespread corruption scandal was part of an illegal culture fostered by elected leaders.

Seven former House Democratic staffers pleaded guilty in the so-called “Bonusgate” probe last week.They admitted spending taxpayers’ money for political purposes, including at least $1 million in bonuses for staffers who worked on Democratic election campaigns.

The defendants are not household names. But they held important positions at the state Capitol.

Defendant Mike Manzo was the longtime chief of staff to Rep. Bill DeWeese (D., Greene), a leader of House Democrats for the past 20 years. Defendant Jeff Foreman was chief of staff to ex-Rep. Mike Veon of Beaver County, DeWeese’s top lieutenant. Defendant Scott Brubaker was the House Democrats’ director of staffing and administration. Defendant Earl Mosley served as personnel director.

Attorney General Tom Corbett has charged DeWeese and Veon, as well as 16 other defendants, including Rep. John M. Perzel (R., Philadelphia), a former Speaker, as part of an ongoing corruption probe. Perzel and others in the GOP are accused of spending millions of tax dollars to create computer programs to help reelect Perzel and other Republicans.

DeWeese has argued that the bonus scheme that helped to make him majority leader occurred without his knowledge or approval. The convictions of these seven defendants who worked for him say otherwise.

Mosley’s attorney, Matthew Gover, told a judge that Mosley “was directed to issue those checks. He didn’t do it of his own volition.”

The prosecutor, James Reeder, replied: “Mr. Mosley knew what he was doing, he knew that it was wrong, and he knew this was part of a big scheme. ... Defense counsel may argue he was only a cog in this big wheel of this big scheme, but he was a felony cog.”

Felony cogs in a big, broken, corrupt government machine. It is inconceivable, and laughable, to argue any longer that they dreamed up such schemes on their own or did it without the knowledge of party leaders.

All of the defendants who pleaded guilty will be required to pay back the state for the theft of taxpayers’ money.

Manzo and Foreman have agreed to forfeit their state pensions — that should be enforced against all of the defendants who are convicted of ripping off taxpayers. Nobody involved in political corruption should enjoy a comfortable retirement at taxpayer expense.

One of the arguments against Corbett’s investigation among Harrisburg insiders is that “everybody did it.” With these seven guilty pleas, we have the response. If everybody was doing it, the place is rotten to its core.

Hazleton's Financial Needs And The Case To Sell The HCA Water Department

When Hazleton's Mayor Lou Barletta announced his plan to lay the foundation for a long term solution to the City of Hazleton's financial crunch many of the taxpayers of the City actually did not see the presentation at City Hall. Due to the impact on low income working families and seniors of the City SOP has obtained the file for the presentation from the City's website.

Taxpayers in the City who sign the petition opposing the sale of the HCA Water Department are really signing a petition for higher taxes. As you are about to see the fixed cost expenses are outpacing revenue despite the opponent claims that the City was mismanaged.

The first slide(not in the presentation but presented here) shows the one time revenue sources by year from 2004 that have postponed the financial crunch from occuring sooner.

The next slide demonstrates how adjusted income failed to keep pace with adjusted expenses.

This next image shows how real estate tax revenue actually declined over the period from 2004-2008.

There was a slight increase in Earned Income Tax Revenue but considering the time frame one could argue that it was essentially flat.

Likewise the Mercantile and Business Privilege Taxes were essentially flat to only very slightly down.

Emergency Municipal Services Tax revenue took a dramatic drop due to Harrisurg and Todd Eachus's messing with the way the revenue is collected. Municipalities across the state suffered, not only Hazleton, because our legislators lack the acumen to understand their mistake.

Employee insurance costs are up over $417,000 for the period 2004-2008. Every municipal employer, as well as most private entities, in the state is facing the same exhorbitant rise in those costs.

Employee salaries really demonstrate one of the biggest reasons for Hazleton's financial crunch. Unfortunately one of the only solutions to this problem is to decrease the size of the police department which in SOP's opinion is not an option given the current crime element trying to take a foothold on Hazleton's streets.

This graph showing overtime costs illustrates another uncontrollable problem for Hazleton that is tied to the last chart. Police investigations into crimes in Hazleton, just like the Derrick Kichline murder, are the biggest reasons for these overtime costs. Snowplowing in the winter time is another factor contributing to this area. If someone can figure out how to control crime and the weather, Warren Buffet and Bill Gates, move over another billionaire will be joining the crowd.

Just these three budget areas demonstrate the devastating impact on the budget of the City of Hazleton and to its taxpayers.

That presentation in a nutshell sums up the reason the sale of the Water Department of the HCA is even being considered. The Mayor and City Council weighed different options before coming to this conclusion. SOP has of yet to see any other viable plan put forward. If Hazleton taxpayers sign the petitions to oppose the sale of the Water Department someone should explain the dire consequences beforehand. Expect a dramatic increase in property taxes due to the reassessment dropping the millage so drastically.

Monday, January 11, 2010

Todd Eachus- If You Want To Run Again Tell Us What You Did For Hazleton

Reporters, If you believe Todd did for seniors what he claims please explain where the 120,000 seniors are who were supposed to have PACE/PACENET and do not??

Todd, how much money have you brought to Hazleton, The Municipality, not the AREA since you claim to be our Representative?

Todd, why should we send you back when you couldn't put a budget through on a matter of fact ...not even close..

Todd, please explain your relationship with Robert Powell?? Please explain why you fought with Senator Musto over the cargo airport for money and secured $250 million? Please explain why you wouldn't make sure Hazleton City was worthy of the same energy and effort you put forth for Robert Powell????? How much did you bring to Hazleton?? Well its not ZERO but damn close.

Maryanne Petrilla as Controller failed Luzerne County..Why did you mentor her??

Hazleton Residents- The Why As To The Need To Look at The HCA Sale

Mayor Lou Barletta's Plan To Secure Hazleton's Future

What happened to Hazleton City's revenue vs. expenses since 2004 and how did the City arrive at its financial position? The slide presentation will prove it wasn't mismanagement as some detractors state. Adjusted Revenue vs. Expenses tells the whole story. Real estate tax down by over $250,000.00- how does one mismanage real estate tax? No growth in Mercantile Tax- how does one mismanage what is paid? Emergency Municipal Services Tax revenue down $225,758.00- again how does one mismanage what is paid in? Employee Insurance up over $417,401.00- every employer is facing the same challenge Salaries- Up over $1,255,372.00- one item, overtime, was over $254,000 in one year, mostly gang related investigations.

Get educated on the real story. The Standard Speaker should be reporting this story; the real question is why are they withholding it from its readers.

Legality of Using The Ordinance Feature Of A Referendum In Question

By definition ordinances are laws enacted by a municipal body that are not already covered by state or federal laws.

Since the Municipal Authorities Act of 2001 provides for the right of a municipality to takeover an authority's assets it would appear that a referendum to create a law that would prevent the sale of the assets of the water department of the Hazleton City Authority would contravene that law. Keep in mind that Hazleton City Council has yet to adopt a resolution or ordinance authorizing the sale of those assets therefore a referendum even if applicable would, at this point, seem premature. Any law enacted by referendum to supercede those powers granted by state law may end up being invalid.

In the case of Erie cited in the Referendum Handbook the voters stopped Erie from selling its water company to an authority. If one looks closely that sale is not covered under any state law per se. Therefore its application in this case is slightly different. Takeover of authority assets are covered by the Municipal Authorities Act, therefore, a signifcant legal question remains whether the referendum mechanism is a viable remedy for those opposed to the sale.

The bigger probelm comes from the opposition itself. Certain persons are self-proclaimed governement watchdogs, yet they want to use the Authority's solicitor as their own private attorney. Those in opposition need to seek outside counsel and prove that they are on legal ground, not just copy and paste something from the referendum handbook to validate their claims.

Sunday, January 10, 2010

Aqua Water- Another Suitor Given Award

EPA Honors Aqua for Rebuilding Bristol Water Plant.

Date: Wednesday, May 9 2007

BRISTOL, Pa. -- Federal, state and local officials gathered here today as Aqua Pennsylvania, Inc. (Aqua) accepted the 2006 Award for Sustainable Public Health Protection from the U.S. Environmental Protection Agency. The award recognizes Aqua's efficient use of federal funding to rebuild the Bristol Water Treatment Plant, which supplies drinking water to approximately 30,000 local residents.

In presenting the award, Jon Capacasa, director of the Water Protection Division for EPA's mid-Atlantic region, said, "We applaud Aqua Pennsylvania for demonstrating outstanding leadership to protect the public's health by making critically needed improvements to the community's drinking water system."

Located in Bristol Borough, the plant began to provide service in 1874 and required a complete overhaul when Aqua acquired the municipal water system in 1996. The company invested approximately $10 million to rehabilitate and upgrade the facility, with $5.9 million of the total financed with a low-interest loan from the Pennsylvania Infrastructure Investment Authority (PENNVEST).

EPA recognized Aqua on the recommendation of PENNVEST officials. "We proudly nominated Aqua for its ability and willingness to tackle the needs of neglected, troubled water systems, such as the Bristol facility, which require both the capital and expertise to bring them up to environmental standards," said PENNVEST Chairman Joseph Manko.

Aqua Chairman and Chief Executive Officer Nicholas DeBenedictis accepted the award. "This honor means a great deal to us, because it recognizes Aqua's commitment to addressing environmental issues and improving water quality. Furthermore, we take pride in using low-interest financing effectively to reduce interest expense, which helps control rates for customers while enabling us to address more capital improvement needs."

Aqua began the plant's overhaul in 1999 and completed the project in May 2001. Improvements included automating the filters and controls, installing equipment to remove solids from the water, upgrading chlorination and electrical systems, integrating a central computer system, and replacing leaking roofs. The project reduced the potential for filter failure and discharge of contaminants and eliminated structural safety hazards.

Among the dignitaries attending the ceremony were State Representative John Galloway (D-Bucks), Bristol Borough Council President Ralph DiGuiseppe and officials from the Pennsylvania Department of Environmental Protection and the Delaware River Basin Commission.

Under EPA's Drinking Water State Revolving Fund program, the agency provides grants to the states, which in turn, use the funds to provide low-interest loans for drinking water projects. These projects support the Safe Drinking Water Act by protecting public health. In Pennsylvania, the program is managed by PENNVEST in cooperation with the Pennsylvania Department of Environmental Protection.

Aqua provides water and wastewater services to approximately 1.4 million residents throughout Pennsylvania, including 1.3 million residents in Chester, Delaware, Montgomery, Bucks and Berks counties. It is the largest subsidiary of Aqua America, Inc. (NYSE:WTR), the largest U.S.-based water and wastewater utility holding company serving customers in 13 states.

NCPPP Award-Pennsylvania American Water's Purchase of the Coatesville Water And Wastewater Assets

Pennsylvania American Water Company's purchase of the City of Coatesville's water and wastewater assets received the National Council on Public Private Partnership's award in 2002.

On March 22, 2001, Pennsylvania - American Water Company (PAWC), a subsidiary of American Water Works Company, City of Coatesville Authority (CCA) and the City of Coatesville closed on the sale of CCA's water and wastewater assets to PAWC.

Benefits Derived from the Partnership
The $48.225 million transaction expands PAWC's service territory to include an additional 8,600 water customers and 6,500 wastewater customers in 16 municipalities. In addition, the sale expands PAWC's revenue base, allowing the company to purchase chemicals and equipment at lower costs because they are bought in larger quantities. This allows PAWC to spread costs across a wider customer base - causing greater economies of scale, which benefits PAWC and its customers. The company also recognizes in the future. Over the next 10 years, PAWC estimates that this transaction will result in adding another 6,000 water customers and 4,500 wastewater customers due to the economic development and new housing starts in the greater Coatesville area.

City of Coatesville and Residents

As part of the agreement, the City and its residents are benefiting from the sale in the following ways:

Rates for both water and sewer are frozen for three years

PAWC will contribute annually to the City's Economic Development Fund
Funds from the sale, which exceeded $39.5 million after the debt was paid, were placed in a Reserve Fund

The City will be given a $10,000 credit for future water usage and a $10,000 credit for sewage treatment.

Funds from the sale are being invested to maximize their return to the City in the form of investment income. At the blended investment rate of 6.8%, the return on the reserve fund will be a minimum of $2.686 million annually, which will be utilized for the following tax cuts and program enhancements:

Tax Cuts ($1,101,000): Earned income taxes were cut in half from 2% to 1%, which equates to a $300 savings for a person earning $30,000/year; real estate taxes were cut by 1 million for improved property (from 6.2 million to 5.2 millions), representing a $100 savings for a $100,000 home; and the per capita tax was eliminated (a $20 fee/person). A family of four, who earns $60,000/year and owns a $100,000 house, would save $740/year ($600 on earned income taxes, $100 in property taxes, and $40 from eliminating the per capita tax).

Small Business Enterprise Development Program ($375,000): Provides financial assistance and technical support for disadvantaged persons who seek to start a business.

Coatesville's Multipurpose Recreation and Activity Center ($200,000): Provides debt service, capital and operating dollars for the construction and operation of the center, which will be open year-round, 24 hours a day, with access for all residents.

Annual Funding for Capital Reserve Fund ($500,000): Fund to be used for road paving, park improvements, municipal construction projects, etc.

Enhance Existing Programs ($273,000): To provide additional funding for existing city programs including the size of the police force, additional support for the Main Street Manager program and expanded public works projects.

Rainy Day Fund ($237,000): To be used for emergencies and special projects.

Another cost savings to the customer came as a result of what is termed service laterals. Pennsylvania - American assumed responsibility for maintaining water and sewer service lines from the main in the street to the service line control valve, usually located at the edge of the customer's property, for those customers who dedicated their lines. Typical costs to maintain broken service lines range from $3,000 to $4,000. Prior to the sale, this was the responsibility of the customer.


The fact that the project was bid was unique. This allowed PAWC to bid competitively on the water and wastewater assets. Otherwise, it could have been sold to another entity, without providing PAWC with the opportunity to bid. Vice versa, this allowed the City to maximize its return on the sale.

Elements within the signed purchase agreement between the two entities were innovative, including the service lateral program. What was the responsibility of the customer at the time of the sale, now is the responsibility of Pennsylvania - American if the customer agreed to dedicate their laterals. This provides a potential cost savings to customers and it provides PAWC with greater control over the operation and quality of the water service, as repairs on these pipelines can be made immediately.

Funds from the sale provided the opportunity to the City for revitalization in the community as well as expansion of its business base through the various tax cuts and economic assistance programs.

The manner in which the trust fund was structured by the city was unique in that all of the dollars obtained from the sale were invested in long-term investments. This maximized the return to the City and will provide permanent financial stability.

PAWC is the largest investor-owned water utility in the state, serving nearly 6000,000 customers in 35 counties. The company's first operation was incorporated in 1818 in Berwick, Pennsylvania. As such, the company offers Coatesville water and wastewater customers the financial resources and nearly two century's worth of experience in providing the highest quality water and service to its customers.

PAWC's knowledge and resources allow the company to keep pace with new regulations. PAWC is a member of the Partnership for Safe Water, and has received 31 Directors Awards from the US EPA, the state Department of Environmental Protection, and other water-related organizations for achieving excellance in water quality far beyond what is required by federal and state regulations. PAWC is now providing the same high level of service to residents and businesses in the greater Coatesville area.

The transition from CCA to PAWC was seamless and transparent to the customers. The City did not receive any complaints from its residents.

Prior to the sale, PAWC associates from operations, engineering, water quality, loss control and human resources met with Coatesville Authority representatives and employees and toured the Coatesville facilities on numerous occasions to determine the needs of the operation. This allowed for a smooth transition upon the PUC's approval.

The sale expands PAWC's revenue base, allows the company to purchase chemicals and equipment at lower costs because they are bought in larger quantities, and allows the company to spread costs across a wider customer base - a greater economy of scale, which benefits PAWC and its customers. The future expansion prospects of the water and wastewater systems also made the purchase of the Coatesville Authority assets attractive to PAWC.

The residents benefit economically as a result of planned tax cuts, a three-year freeze on their water and wastewater rates, and through the service lateral program.

The City of Coatesville has gained permanent financial stability from the sale, and has enabled them to invest more economic development and community programs and provide significant tax cuts to its residents.

Public-Private Partnership
This partnership between Pennsylvania - American Water Company, the City of Coatesville Authority and the City of Coatesville fits the definition in that it was a contractual agreement, whereby Pennsylvania - American would purchase and therefore own and operate, the Authority's water and wastewater assets. In order for the partnership to be a success, it required the efforts of all partners involved and, as a result of the partnership, all partners benefited from the contractual agreement.