Luzerne County Council grants only part of chamber loan forgiveness request

By Jennifer Learn-Andes - | April 12th, 2016 10:37 pm

By Jennifer Learn-Andes

The Luzerne County Council voted Tuesday to forgive $728,226 in community development loans so a $6.1 million downtown Wilkes-Barre redevelopment project can proceed, but another $1 million in loans owed by the Greater Wilkes-Barre Chamber of Business & Industry will remain on the books.

Council members initially believed the entire development project was at risk if they didn’t approve the chamber’s request for $1.7 million in loan forgiveness. Additional documents circulated in recent days clarified that $1 million in loans were tied to other unrelated chamber projects.

Wico Van Genderen, the chamber’s president and CEO, told the council Tuesday his organization may be unable to repay the $1 million in loans that were not forgiven because the chamber had sold all valuable real estate associated with that borrowing, leaving no other revenue stream.

The money came from the county’s community development revolving loan fund, which relies on loan repayments and interest earnings to continue providing new loans to area businesses. The money can’t be used for general fund operating expenses.

The $728,226 in approved loan forgiveness will clear liens on the chamber’s Innovation Center @ Wilkes-Barre on South Main Street so the property can be sold to Red Talon Group 1 LLC, a private development entity.

Red Talon wants to buy the Innovation Center and First National Bank Building on Public Square to create 120 high-tech jobs and spur other growth.

Some county council members requested ownership information on Red Talon because documentation referred to the entity as a collaboration.

George Albert told the council Tuesday he is the sole member, officer and owner of the entity.

As part of the loan forgiveness, the chamber agreed to use $1.7 million of its $2.6 million in proceeds from the Innovation Center sale to repay $1.7 million in outstanding county community development loans. That money will go back into the loan fund.

The rest of the chamber’s sales proceeds will be used to repay about $126,600 in back real estate taxes owed to the county, city and Wilkes-Barre Area School District on the Innovation Center and close out a $704,000 state loan, Van Genderen said.

Once the $1.7 million in loans is repaid, the chamber will owe the county $3.8 million in addition to the $1 million that was not forgiven Tuesday. Van Genderen said he is confident the chamber has enough real estate collateral to repay the $3.8 million.

The community development loan fund currently contains $16 million.

Eight county council members approved the loan forgiveness at the reduced amount. Council members Edward Brominski, Kathy Dobash and Stephen A. Urban voted against the forgiveness.

In other business, the council approved a union contract amendment providing raises to 911 center telecommunicators.

The amendment will boost the starting salary of 911 telecommunicators from $25,500 to $32,000 and provide $2,500 raises to current telecommunicators making more than $32,000. It also allows up to 33 to undergo testing and meet other requirements to become telecommunicator specialists, a designation that will provide an additional $2,500 raise.

County officials say the move will address concerns about turnover, morale and recruitment. Telecommunicators regularly leave to accept higher paid emergency dispatch positions in other counties and the state, officials said.

Dobash was the lone vote against the amendment.

A council majority also rejected Brominski’s call to issue a “no confidence” vote for the citizen search committee that will recommend three finalists to the council for the vacant top county manager position.

Brominski said he advocated the action because search committee members informed the council during a March 22 closed-door executive session that the committee had voted in executive session to disqualify a manager applicant.

The committee later publicly voted on the disqualification at its March 30 meeting, but Brominski said the initial closed-door vote was a “direct violation” of the state Sunshine Act governing open meetings.

Urban and Dobash were the only council members who supported Brominski’s motion. Several council members said they did not believe the months of work completed by the volunteer committee should be discredited due to an error that was remedied by a public vote.

In response to the council feedback, Brominski withdrew his second agenda request to disband the search committee and appoint a new panel.

Council Chairwoman Linda McClosky Houck said the search committee informed her it will be submitting the names of the three manager finalists to the council in a sealed envelope on Friday.

The council members will then schedule its own interviews of all three, she said.

The council also voted Tuesday to:

• Abolish three outside boards due to a lack of activity and public interest: the Commission for Women, the Diversity Commission and the Municipal Cooperation Commission.

• Appoint or reappoint several citizens to outside boards: Conservation District, Timothy Connolly and Chris Maylath; Drug and Alcohol Commission, Kristen Hansen; Industrial Development Authority, Jason Cyphert; Community College Board of Trustees, Lynn Distasio; and Mental Health/Developmental Services Advisory Board, Todd Hastings.

Reach Jennifer Learn-Andes at 570-991-6388 or on Twitter @TLJenLearnAndes.