Plymouth council rejects lone $400,000 loan bid over contract and account requirements

Plymouth Borough Council opened a sealed bid on June 20 for a $400,000 tax-exempt note intended to finance a gate isolating the Beade Street chamber from a culvert that discharges into the Susquehanna River. Council member Ron Kobusky instructed the borough solicitor to open the single sealed bid, which Attorney Mike Kostelansky identified as being submitted by Community Bank N.A.

The solicitor read the bank's proposal into the record: a $400,000 loan at a proposed 5.78% interest rate, maturing Nov. 30, 2034, with payments beginning Nov. 30, 2024 and continuing annually. Kostelansky said the bid also required the borough to move operating accounts to the bank with a minimum balance of $100,000 and proposed that the bank's bond agents, rather than the borough solicitor, prepare paperwork submitted to DCED. Kostelansky told council those provisions deviated from the borough's request for proposals and could impose additional costs and legal changes compared with the RFP.

The council moved into an executive session to review the bid. After returning, Council member William Dixon moved to reject Community Bank's proposal; the motion was seconded by Earl Cunningham. The council voted 5-0, with two members absent, to reject the bid.

Council did not vote to accept any alternative lender during the meeting. Kostelansky recorded the bid as received June 24, 2024 at 1:23 p.m.; the RFP called for sealed bids submitted on or before June 20 by 2:00 p.m., a discrepancy noted in the meeting record and discussed by the solicitor. Council ultimately rejected the bank's proposal on the solicitor's recommendation because of the deviations from the RFP terms and potential additional costs to the borough.

The council also voted to reappoint PennEastern Engineers as borough engineers during the same meeting (see separate item).