Luzerne County authority retains lender for new infrastructure fund

A Luzerne County Redevelopment Authority majority voted Tuesday to award financing of a new infrastructure fund to Fidelity Bank.

Under new legislation, the authority will borrow to create the fund of up to $55 million and repay the loan with $3 million provided annually for 25 years from the casino-gambling Local Share Account (LSA).

County council agreed to guarantee the loan, in the unlikely event casino revenue ceases, because the authority is limiting use of the borrowed funds to infrastructure owned by county government.

An authority majority had previously selected Fidelity Bank from five financial entities that responded to a request for proposals, but the authority decided to seek proposals again because the county guarantee was not part of the original request.

Fidelity Bank was the lone entity to submit a complete proposal the second time around, although it partnered with additional banks in the latest submission, the authority said.

Fidelity teamed up with FNCB in the first proposal and added Peoples Security Bank & Trust and Wayne Bank in the second one, the authority said. However, FNCB subsequently withdrew from the proposal to prevent any appearance of a conflict because redevelopment authority board member Nina DeCosmo is on an 18-member bank advisory board, the authority said.

Redevelopment authority Solicitor Garry Taroli said Tuesday he is not convinced there would have been a conflict because DeCosmo is not on the bank’s governing board and does not have a vote as an advisory member.

Authority board members John Pekarovsky, Stephen E. Phillips and DeCosmo voted to retain Fidelity, with DeCosmo stressing her vote hinged on the understanding FNCB has withdrawn.

Board members Scott Linde and Mark Rabo voted no, raising concerns about the lack of final terms and details.

Other authority representatives said the board approval is needed to proceed with final negotiation to obtain a financing package that will yield the most cash for the fund, and thus, county-owned projects.

Borrowing must be completed for the authority to start receiving the annual $3 million payment, according to the state legislation.

As it stands, replacement of the county-owned Nanticoke/West Nanticoke Bridge over the Susquehanna River, currently estimated at $51 million, is stated as the main project to be funded, although county officials will have flexibility if they deem other projects a higher priority, officials have said.

In priority order, deteriorated sections of the following roadways also would be addressed if funding is available under the plan: Main Road in Hunlock and Ross townships, $1 million; Lower Demunds Road and Upper Demunds Road in Dallas and Franklin townships, $650,000; Ransom Road in Dallas and Franklin townships, $500,000; Church Road in Wright Township, $500,000; Oak Hill Road in Wright Township, $500,000; Crestwood Drive in Wright Township, $250,000; Old Airport Road in Butler Township, $250,000; and Hanover Street in Hanover Township, $250,000.