When I first took office on Middletown Borough Council I was quite impressed. Middletown was so well off financially that they allowed the Middletown Area School District to keep the entire 2 percent of the local earned income tax. It was designed to give 1 percent to the school district and 1 percent to the municipality.
The occupation tax was only $30 for Middletown schools at a time when Lower Dauphin’s occupation tax was $200.
Everybody’s electric bill was really low. For the first time, Democrats outnumbered Republicans on council.
Middletown at that time received a favorable electric rate from Met-Ed. Met-Ed had just gone to court before I was sworn into council to rescind its contract with the borough. Middletown won and the Borough got to keep their favorable electric rate. Originally Middletown had given Met-Ed a substation for a rate freeze of 1 cent per kilowatt/hour. This was not a very favorable rate at the time. The average rate was only one-half cent per kilowatt/hour. I can’t figure that one out.
Middletown made a tremendous amount of electric revenue profit. Paul Bradtmiller told me the way council spent money, they were blowing their inheritance. This money was spent on an excessive number of employees and vehicles.
On June 30, 1982, I wrote an open letter to the residents of Middletown concerning the amount of revenue it takes to run the town. I had adjusted it concerning the electric expenses. Also, the water and sewer is on a different budget. I compared Middletown to other local communities. No one challenged my figures.
Here is my quote out of that letter: “The Borough of Middletown paid an exorbitant fee of $10,000 for a comprehensive plan. It states that we should use fiscal resources derived from the resale of using electric only to support community improvements.” It should not be used for day to day operations of the borough. But Middletown used it for day to day operations.
At that time, the water tank on High Street was leaking from the bottom and there was a fear it could actually slide out onto the street. It was pointed out that this would have been a perfect use for the electric profit.
According to my letter, this was a list of communities and the tax revenue per person it took to run their community: Middletown, $168.23 per person; Elizabethtown, $80.48; Lower Swatara Twp., $118.96; Steelton, $136.41; Swatara Twp., $105.22; Lower Paxton Twp., $128.91; Susquehanna Twp., $114.12; East Pennsboro Twp., $93.16; Mechanicsburg, $105.41.
There were some councilmen who cared about this town. Two of them are still on council – Bob Louer and Dave Rhen. Once during a council meeting I noticed that electric depreciation was being funded and treated as an expense instead of an expenditure. We already had a sinking fund. I took Bob Louer up to meet with an employee of the Auditor General. Sure enough that employee from the Auditor General confirmed that depreciation is an expenditure and not an expense. It should not have been funded.
Who knows what happened to the mon- ey? It was corrected in future budgets.
In another instance, we had money left over from some federal funds. I suggested using this money to create a fund to loan money at a very affordable interest rate. Council went along with this suggestion. It was to be a revolving fund and when loans were paid back more money could be loaned later at the same favorable rate. I’m sure someone figured out a way to waste that money after I left council.
What’s the answer? Middletown needs to sell the electric and water and sewer departments to private companies.
The borough employees control the borough. When I read Sound Offs against Bob Louer and Dave Rhen, I know where they’re coming from.
Borough employees could keep their jobs working for the private companies.
The borough should sell its excess vehicles.
There would be a tremendous fund along with the electric settlement to be used for community projects when needed. It would put Middletown residents in a great financial situation for years to come.
(The writer is a former Middletown Borough Council member.)