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Lebanon council waives PILOT for LEAP utility district until bonds are repaid after heated public comments
Summary
The council adopted ordinance 2025‑40 to waive payment‑in‑lieu‑of‑taxes (PILOT) for the LEAP water/wastewater district until its bonds are repaid; utility board and staff said the waiver protects civil‑district ratepayers, while at least one resident accused the city of mismanaging contracts.
During its Dec. 8 meeting the Lebanon City Council adopted ordinance 2025‑40, waiving pilot payments from Lebanon Utilities for the LEAP water and wastewater districts while bonds funding that infrastructure remain outstanding.
Jeff Jacob, speaking for the utility board, said Lebanon Utilities is a tax‑exempt entity and that the board unanimously recommended a waiver for the LEAP district to avoid shifting large rate increases to the utility’s civil‑district customers. "We don't have the customer base to collect those funds in order to build up enough to make a pilot payment to the city," Jacob said, explaining that the LEAP rate structure and bond design mean the utility cannot make the payment now without harming other customers.
Council engaged multiple questions about whether the civil‑district customers were protected and whether the council could revisit the waiver. Jacob said the council retains discretion to resume pilot payments "upon full repayment of the bonds," and that bonds can be retired earlier if customer uptake accelerates.
During public comment an attendee (SEG 19) accused the utility and the city of moving forward with infrastructure without secured funds and called the contract "a false contract"; that speaker argued the LEAP infrastructure served economic development and alleged the city had ignored residents' notices. The utility representatives disputed the accusation in their presentation and emphasized the financial uncertainty inherent in phased infrastructure buildouts.
The council voted to approve ordinance 2025‑40 (motion made by speaker 11; second from speaker 14) and the measure passed 5–1. The ordinance states the waiver is effective immediately upon passage and that pilot payments for the LEAP district shall be collected again upon full repayment of the LEAP bonds.
