The Cambria Somerset Authority, aka CSA, is borrowing a total of $ 200,000 less next year from the two counties that help run it.
At its December meeting on Thursday, the board approved a loan agreement for 2022. The CSA is to borrow $ 190,140 from the Cambria County and Somerset County governments as part of its overall operating budget of $ 1.4 million.
That amount is $ 100,000 less for each county than what the authority has borrowed in recent years, said authority chairman James Greco.
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How is the CSA loan money used?
The annual loans are needed to pay off a bond issue and a bank loan that the authority used to fund the cost of the reservoirs it purchased from Manufacturers Water Co. more than two decades ago.
“We are making enough money (from the sale of municipal water) to finance our normal operating costs,” said Greco, “but not to pay our debt service”.
Members of the authority have refinanced the debt twice since purchasing the tanks, Greco said. The bonds are due to be repaid in June 2029. The bank loan is due to be repaid in June 2034.
Somerset County Commissioner Colleen Dawson abstained in the vote to approve the Somerset County deal. Cambria County Commissioner William “BJ” Smith abstained in the vote to approve the Cambria County deal.
The two commissioners are members of the board of directors.
Is the CSA in good financial health?
Each county’s loan amount is lower for 2022 as the authority’s emergency repair fund starts the year in a stronger position, Greco said. Fewer emergency system repairs were needed in 2021 than in recent years.
“We are running a 120 year old system,” he said. “We have always tried to run a very thrifty system. We try to run it as cheaply as possible without compromising the future, and we have operated (the properties) with fewer people than the Manufacturers Water Co. has. for the past 20 years. we have owned it. “
The authority’s 2022 budget also includes grants of $ 47,550 from each county to make monthly payments on two Pennvest loans the authority obtained for work at the Quemahoning reservoir and the Quemahoning pipeline. These loans are expected to be repaid in 2023, Greco said.