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Peters Township Council authorizes $10 million bond issue

The development of half of the former Rolling Hills Country Club as a municipal park continues to move forward in Peters Township.

On Monday, township council unanimously approved an ordinance authorizing the issuing of $10 million in general obligation bonds, with the bulk of the money earmarked toward providing a series of public amenities at what has been christened Rolling Hills Park.

Addressing one of the projects to be financed through the bond issue, council also awarded a $340,478 professional services contract to Mackin Engineering Co. for the design of the park’s first phase.

Mackin will develop plans for an interior road to provide access to the park from Rolling Hills Drive, the yet-to-be-built street connecting East McMurray and Center Church roads through the property. Also included in the first phase, as reached by a consensus of council last year, are walking and biking trails, utility connections, a maintenance garage and a “Great Lawn” area with picnic shelters and restrooms.

Borrowing the money is coming at a good time, according to financial adviser Tim Frenz of Janney Montgomery Scott LLC, with interest rates at around 2.5 percent annually for 30-year bonds issued by municipalities with a Standard & Poor’s credit rating of AA-plus, as Peters has.

“I think it makes this township look accurately exceptional,” Frenz told council. “I think it also speaks highly of the management team.”

He said that a couple of market aspects should help with the sale of bonds, scheduled for July 16.

“Volume has been picking up because interest rates have been dropping, but volume throughout this year has been surprisingly extremely low, both nationwide and in the Commonwealth of Pennsylvania,” he explained. “So there aren’t a lot of bonds to be bought.”

Meanwhile, more investors are looking to put money into municipal bonds.

“Over $50 billion in new, additional investable money has come into the U.S. market over the last six months,” Frenz said. “That’s the strongest six-month start to a year for muni investment in the last 10 years.”

The 2019 bonds will join previous issues in 2013 and 2016, along with a bank loan in the latter year, which put the township’s current debt service at about $1.3 million per year, a figure that eventually drops in half.

“It basically adds about $300,000 a year to your payment schedule,” Frenz said about the new issue.

Part of the debt about to be incurred will pay for the Phase 1 park design, for which two firms, both of which have done substantial work at the site, submitted bids. The other was from Herbert, Rowland & Grubic Inc. for $597,500, topping Mackin’s by about $257,000.

“In reviewing the proposals and also having subsequent meetings with those firms, it was clear that both firms understood the scope of the work and were comfortable with the value that they had assigned toward accomplishing those tasks,” township manager Paul Lauer said.

The township’s 2019 budget assumes $418,000 for the design, according to information provided at the council meeting.


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Report shows Pennsylvania's Appalachia residents make $7,000 less than state average

A new report shows that residents of Appalachia Pennsylvania counties made an estimated $7,076 less in 2017 than the per capita market income for Pennsylvania.

In 2017, the per capita market income (PMC) for Appalachian Pennsylvania was $36,093, while Pennsylvania’s PCM was $43,169, according to the report from the Appalachian Regional Commission (ARC). Per capita market income is a measure of an area’s total personal income, less transfer payments, divided by the resident population of the area.

The ARC used an index-based county economic classification system to identify and monitor economic statuses of Appalachian counties.

The system compared each county’s averages with national averages. ARC looked at three economic indicators: three-year average unemployment rate, per capita market income and poverty rate.

“The resulting values are summed and averaged to create a composite index value for each county,” the report said. “Each county in the nation is then ranked, based on its composite index value, with higher values indicating higher levels of distress.”

After the data is collected, each county is classified into one of five economic designations: distressed (dark red); at-risk (light red); transitional (white); competitive (light blue) and attainment (dark blue).

According to ARC’s County Economic Status Designations for Fiscal Year 2020, 80 counties will be considered distressed (ranking among the worst 10 percent of counties in the nation) and 110 counties will be at-risk (ranking between the worst 10 to 25 percent of counties in the nation).

Forest County is the only county in the state that is considered distressed. Fayette County will be ranked at-risk for fiscal year 2020. Washington and Greene County were ranked as transitional.

Forest County’s PCM was $12,458 – $30,711 less than the state average. The poverty rate in Forest is at 14.1 percent. In Fayette, the PCM was $27,345 and the poverty level is at 18.8 percent. Both county’s unemployment rate from 2015 to 2017 were among the highest in the state – at 7.5 percent.

China Riddle, a communications specialist for ARC, said Forest County is considered distressed because the county worsened on all three of ARC’s economic indicators during the past year.

“Per capita market income worsened from $15,440 (38 percent of the national average) in 2016 to $12,458 (29.1 percent of U.S.) in 2017, which is a decline of 19.3 percent,” Riddle said. “The poverty rate of Forest County worsened from 12.7 percent to 14.1 percent between the last two non-overlapping five-year periods, causing its rate relative to the national average to worsen from 84.3 percent to 96.7 percent. All three of these factors combined caused the shift into the distressed category for FY 2020.”

Riddle said that although Fayette County’s income and unemployment rate improved, other U.S. counties improved at greater rates, causing Fayette to slip into the at-risk economic category.

“Relative to the national average, Fayette County worsened on all three of ARC’s economic indicators in the past year,” Riddle said. “While the county’s per capita market income improved by 3.2 percent from $26,487 in 2016 to $27,345 in 2017, the national average improved at a greater rate (5.4 percent), causing the county’s value relative to the national average to worsen from 65.1 percent to 63.8 percent of the U.S. rate.”

Bob Shark, executive director for the Fay-Penn Economic Development Council for Fayette County, said Fayette will be considered transitional when the ARC releases economic status designations in the upcoming years.

“There’s a lot of activity going on in Fayette,” Shark said. “Recently there’s been a lot of growth with our businesses and it probably hasn’t shown in the reports because those are taking numbers from 2017. Fayette will be considered transitional when the next report comes around again.”

The majority of Appalachia Pennsylvania was considered transitional, which ranks the county between worst 25 and best 25 percent of counties in the nation. Four counties ranked as competitive: Allegheny, Butler, Montour and Perry. This means they were ranked between best 25 and best 10 percent of counties in the nation.

The ARC report also found that fiscal year 2020 will have the lowest number of designated distressed counties in Appalachia since 2008. Twenty-nine counties across eight states experienced positive shifts in economic status since 2019, and 18 counties will experience negative shifts in economic status, primarily coal-impacted counties in Ohio, West Virginia and Pennsylvania.

“Parts of the Appalachian Region face significant economic challenges compared to the rest of the country, and by releasing this data publicly in an accessible format, ARC is seeking to ensure awareness of these challenges, and to inform policymakers at all levels,” said ARC Federal Co-Chair Tim Thomas. “ARC and our state partners use this data to direct critical investments toward distressed areas, and I am pleased to see net improvements in many parts of the region compared to previous years.”

Only three counties in Appalachia were considered in the highest ranking. Bath County, Va.; Forsyth County, Ga.; and Shelby County, Ala., were ranked as attainment counties.

Of the 67 counties of Pennsylvania, there are 52 counties that contribute to the 420 counties in Appalachia. The 15 counties not in Appalachia are in the lower corner of the state.


Localnews
Local lawmaker clashes with councilman after LSA discussion

Following a meeting during which state Rep. Bud Cook talked to local elected officials about transparency in how Local Share Account funding is doled out, he got into a heated discussion with a Charleroi councilman.

“You know … the DCED (state Department of Community and Economic Development) audits this stuff every year,” Mark Alterici told Cook.

Cook made news recently, pressing for increased oversight about how LSA money – which comes from casinos – is given out in the counties that receive it. Both Fayette and Washington counties get gaming revenue that is distributed to community projects. On Tuesday, Cook appeared at a Twilight council meeting, one of several stops he said he intends to make to educate local leaders about his concerns over which projects get funding, who’s deciding that and how it’s being decided.

Cook said the process needs to be “fair, transparent and accountable at all levels of government,” and expressed particular concern about whether Washington County handles it fairly.

Alterici, who also serves as chairman of the Washington County Tourism Agency’s board of directors, pressed Cook about why he didn’t answer a question posed to him about whether the DCED audits LSA committees and the Washington County Chamber of Commerce.

“You talk about transparency, but why didn’t you answer that question?” Alterici asked.

Cook told Alterici he didn’t answer the question about DCED audits “because I didn’t receive the right-to-know (answer) from DCED yet.”

The lawmaker said he’s filed right-to-know requests with the DCED and Washington County Redevelopment Authority to dig deeper into records that were kept by the county’s LSA committee, which decides to whom and how the funds are distributed. He said he did so because he is concerned there is a conflict of interest between those who hand out the funds and those who are receiving them.

During the meeting, Cook noted that Jeff Kotula has served as chairman of Washington County’s LSA Review Committee, as well as president of the Washington County Tourism Promotion Agency and the Washington County Chamber of Commerce – nonprofit organizations that also receive LSA funding.

Outside of the meeting, Alterici challenged Cook’s concerns about Kotula.

“Have you ever picked up the phone and asked Jeff how this works?” asked Alterici. “For whatever reason, I think you have an ax to grind with Jeff. You don’t like him personally.”

“Whatever you want to believe, you go ahead and believe,” said Cook.

Cook said he would rather be spending his time enacting legislation and meeting with constituents than looking at how LSA funds are distributed.

“I just want to make sure the process is transparent and that every municipality gets their fair share,” said Cook. “A small municipality like Twilight might only be getting $5,000 in LSA money. But that’s $5,000 that can be used for a road or another important project.”

He is seeking co-sponsors for legislation that would require LSA revenue to be distributed directly to Washington County school districts for the sole purpose of achieving additional property tax relief for homeowners.

“If we don’t establish this kind of reform, there will still be major concerns about conflicts of interest, as well as special interest earmarking of funds or insider deliberation of projects in advance of the grant presentations,” said Cook, who called for the LSA Review Committee to maintain and provide records of voting decisions, minutes and correspondence.

He additionally wants to set term limits for committee members, require them to complete an ethics statement regarding potential conflicts of interest and has asked the state auditor general to look into the matter.

Cook said he doesn’t want to do away with LSA funding – he just believes that it’s important to know the process undertaken to distribute it.

“It’s a game of connecting the dots and following the money. I’m not here to condemn or blame. I’m just questioning why there isn’t more transparency and accountability,” he said.


Eleanor Bailey/The Almanac 

Kent Tekulve

Eleanor Bailey/The Almanac

Eleanor Bailey/The Almanac

Eleanor Bailey/The Almanac

Kent Tekulve


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Rice Team wins proxy fight, takes control of EQT

EQT Corp. is getting a triple serving of Rice.

Toby Z. Rice has prevailed in the proxy fight he launched in October as he, his brother Derek and the seven board candidates they nominated gained control of the oil and gas company in a shareholders vote Wednesday morning. The vote occurred during the firm’s annual meeting.

Five others were nominated to the 12-member board, including Danny Rice, CEO of the former Rice Energy, an oil and gas firm EQT purchased 20 months ago. EQT and the so-called Rice Team agreed on that slate of nominees.

A news release from the downtown Pittsburgh-based company, the largest oil and gas producer in the United States, said Wednesday morning that all 12 who were elected received more than 80 percent of the votes. More specific figures were expected later.

The new board, alphabetically, will consist of: Lydia Beebe, Dr. Philip Behrman, Lee Canaan, Janet Carrig, Dr. Kathryn Jackson, John McCartney, James McManus II, Anita Powers, Daniel Rice IV, Toby Rice, Stephen Thorington and Hallie Vanderhider.

The directors met later Wednesday, and were expected to name Toby Rice president and chief executive officer, succeeding Robert McNally.

Toby Rice said in a statement: “Now is the time to put this proxy contest behind us and come together as one team to transform EQT into a technology-enabled, sustainable energy producer. There is a lot of work to be done, and we look forward to rolling up our sleeves.”

McNally, who was hired only last August, said in a statement that he thanked “employees across the organization for their outstanding work and dedication.” The board, in turn, thanked McNally for his service.

The Rices’ intentions became public in December, two months after EQT announced miserable third-quarter results. Results improved during the first quarter this year, but the Rice Team was boosted recently by support from Institutional Shareholder Services, a proxy advisory firm, and D.E. Shaw, a hedge fund.

It has been an interesting 11 years in Southwestern Pennsylvania for the Rices. The South Boston brothers founded Rice Energy Inc. in 2008, located it in Southpointe, and processed their first lateral well in 2010. They nurtured their company into one that would go public in January 2014 with 145 employees, and eventually increase its payroll to about 600.

Rice Energy outgrew its offices in Southpointe and moved into a much larger building, in the Zenith Ridge project in Southpointe II, in early 2016. The company operated there until November 2017, when EQT bought it for $6.7 billion.

Until the sale, Danny Rice was CEO, Toby chief operating officer and Derek vice president of exploration.

EQT Corp. focuses its natural gas production in the Appalachian Basin, where it has thousands of shale wells in Pennsylvania, West Virginia and Ohio. EQT has about 850 employees, 150 of whom work in the Southpointe offices where Rice operated. Some previously worked for Rice.