Supervisors OK $5.5M More to Township Debt

The township approved a $5.5 million, 20-year reset loan with Univest Bank in December for the purpose of open space acquisition for a future community center

If had a wish list, then two things would be right at the top: complete the condemnation lawsuit with the Zehr family and acquire the Zehr tract as open space, and construct and open a community center at Stump and Horsham roads.

While the former remains in litigation to this day, the latter may be on the horizon in the next two years.

The future of both properties rests with a decision from the state Department of Community and Economic Development.

Supervisors approved 4-0-1 Monday night an ordinance to increase the township debt by $5.5 million for open space acquistion.

On Dec. 12, the board entered into an agreement with a 3-1-1 vote with Univest bank for a tax-free loan of $5.5 million for 20 years, at a rate of 2.55 percent fixed for seven years, with the rate resetting every seven years at 67 percent of the prime.

The loan agreement will add $5.5 million in debt to the township and increase debt service payments, funded by dedicated tax millage, of the township, according to the ordinance.

The purpose of the loan is to acquire land for open space and parks and recreation, according to finance director Shannon Drosnock.

Supervisor Mike Fox abstained from the Dec. 12 vote and the Monday evening vote, as he is employed by Univest Bank.

Supervisor Robert Birch cast the dissenting vote in the Dec. 12 decision.

The township wants to finance a $1.5 million property purchased across the street from the administration building that could be the future site of a community center.

The township purchased the land at Stump Road and Horsham Road in November after it went into foreclosure. The property was owned by Univest.

The financing would also cover the cost of the Zehr property adjacent to , which the township remains in litigation over with the Zehr family.

The Univest plan calls for an estimated principal and interest annual payment of $352,488.

The township has to keep its debt service under $500,000, or else taxes would need to be raised to make up the excess.

At Monday's meeting, Drosnock said that, as part of adopting and taking on that loan, the township is required by the DCED, under the Local Government Unit Debt Act, to pass an ordinance that would increase the indebtedness of the township.

The DCED also required the township to advertise a legal notice for a minimum of three days prior to Monday's meeting.

She said Monday that the ordinance was reviewed by the bond solicitor, Megan Santana, of Fox Rothchild, and township solicitor Frank Bartle.

With the adoption, the township will, per DCED rules, advertise a legal notice within 15 days to notify the adoption of the ordinance.

"During the course of those 15 days, we would be working with the bond counsel and the township solicitor to ensure the proper application is filed with the DCED," said Drosnock. "Once it is filed, the DCED has 20 days to review it and approve or deny it. We see no reason that they would deny it."

Then, the township would enter into the agreement with the bank.


More »
Got a question? Something on your mind? Talk to your community, directly.
Note Article
Just a short thought to get the word out quickly about anything in your neighborhood.
Share something with your neighbors.What's on your mind?What's on your mind?Make an announcement, speak your mind, or sell somethingPost something
See more »