Limerick explores sale of sewage facilities.

Looking to fund $22 million in capital projects

In an effort to keep taxes where they are but pay for more than $22 million in capital projects, officials are exploring the sale of the township’s sewage treatment facilities.

The board of supervisors is trying to fund the construction of a new police and administration building, renovate two fire houses and pay for additional costs for equipment while also keeping taxes at the current level. The tall order will require the board to think about selling off assets and first on the list apparently is the sewage treatment facil- ity. It’s currently reaching out to organizations that would be interested in the sale to submit a list of their qualifications and then officials will decide which companies will get to bid.

In the past, organizations that operate sewage treatment facilities have informally inquired as to whether the township would be interested in selling its system, Township Manager Dan Kerr explained.

The board of supervisors has looked at how much money it could get from such a sale but the offers have never been high enough for serious consideration.

This time, however, is different. New legislation out of Harrisburg and the board’s commitment to funding over $22million in capital improvement projects without raising taxes has changed the situation, he said.

Earlier this spring, the General Assembly passed Act 12, which allows municipalities to sell sewer systems at market value instead of at a public utility commission evaluation, Kerr said.

“It possibly could add more value to the system,” he said.

In addition, the supervisors are exploring funding options to pay for upcoming public safety capital improvement projects without a tax hike, Kerr said.

The township is gearing up for a new $9 million police headquarters and administration building. Designs and engineering is already underway and construction is slated to begin later this year or in early 2017.

Additionally, over the next 15 years, the township has $13 million budgeted to renovate the two township volunteer fire company stations and purchase new equipment. Limerick Fire Company will undergo a $3.5 million renovation first. The township will use reserve funds for soft costs, dropping that total down to about $3 million, according to the budget. The money available fromthe fire real estate tax will be enough to cover the roughly $140,000 in debt this township will take on.

Then the Linfield Fire Company will undergo a $2.5 million renovation, Kerr said. Equipment, including the purchase of new fire trucks, will likely take up the remaining $7 million budget.

The supervisors agreed that selling the sewer system could be a viable funding solution over raising taxes, Kerr said.

“We found the only possible way to do that was to put a formal request for proposals out on the street,” he said. “And see if it’s even worth our while.”

Kerr emphasized this was a exploratory process to understand the true value of the sewer system through the proposal process. Currently, the township is requesting organizations interested in purchasing the system to send a list of their qualifications to determine if they are qualified to bid. Once those are received, the township will select the ones most qualified and have them submit formal bids for the system. By the end of August or early September, the township should know which organizations are qualified. Bids will then likely be received by the middle of November or early December.

“Looking at this from a truly business standpoint, we’re mandated by state law to provide fire service,” Kerr said. “Right now Limerick does that by volunteer service. Volunteer fire service is struggling — higher costs, higher costs for training, lack of volunteers. Hope we have a volunteer force for as long as possible. Have to be ready to assume there will be a paid force at some time.”

“It’s the same conversation every community is having,” he continued. “We have an asset in the sewer system. Should we continue to be in the sewer system business? By law, we do not need to be in that business.”

“We found the only possible way to do that was to put a formal request for proposals out on the street. And see if it’s even worth our while.” — Dan Kerr, Limerick Township Manager