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City of Jeannette is facing settlement, pension payments

| Wednesday, Aug. 21, 2013, 9:00 p.m.

The City of Jeannette will be able to pay the money it owes a local businessman as soon as a final figure is determined, according to the councilman in charge of finances.

Councilman Bill Bedont said the city is waiting for several “legal matters” to be resolved before paying the settlement it owes to Frank Trigona and his attorney Robert Lightcap. Bedont said a final figure has yet to be determined but that the city will be able to make the payment.

The city has been trying to restructure a 2006 bond issue and, if successful, it could free up about $500,000 in cash to be used toward the settlement.

The original settlement was slightly more than $235,000, but late last month Judge Richard McCormick Jr. added interest bringing the totals $110,000 for Trigona and $161,000 to be paid to Lightcap.

Trigona sued because the city refused to grant occupancy permits to two rental properties he owns because he owed back taxes. A county judge ruled that the city's actions were illegal, and an appeals court upheld the decision.

Bedont said legal issues related to those final figures are still being worked out and a true amount owed has yet to be determined.

Meanwhile, First National Bank has filed a garnishment against the city requiring that any money due to Trigona be paid to the bank for a loan he defaulted on — and since that garnishment was applied in May, Trigona and the bank have been arguing over how much Trigona owes.

Trigona also owes the city and county more than $316,000 in back taxes, making him the city's third largest debtor behind the former Monsour Medical Center and Jeannette Glass plant.

Restructuring the bond issue would free up some cash, but Bedont said the city has the funds on hand to pay the settlement without the help of the bond.

“We still have the financial means to meet the obligation,” Bedont said. “I still fully expect to get (the bond restructured). I'm not hearing anything negative (regarding the bond).”

Earlier this summer, Bedont said he planned to pay off last year's police pension payment by the end of this month, but in light of the Trigona settlement the city is holding off on sending in the final $164,000 in case those funds are needed.

If the bond is restructured, the city will get a check for about $500,000 — basically the city would be borrowing against the equity it has built up by repaying the bond over the years, much like a home equity loan works for individuals.

The bond repayment schedule would be extended by a few years, according to Bedont, and the payments initially would be lower. Over time, however, the payments would gradually increase until the loan is paid in full.

Restructuring the bond would make it easier to pay the Trigona settlement, Bedont said.

The cash freed up by such a move would also help the city as it heads into the final months of the year because December brings with it the 2014 police pension bill — which, if paid in full, would be $536,000.

Council discovered last that previous councils and city officials had taken a 25 percent discount on the annual pension payments. Those “discounts” were technically unpaid portions of the pension debt that were added to the following year's payment.

Over time, those unpaid “discounts” pushed the city's annual payment to the level it is today. Bedont has said previously that if the discounts were never taken, the pension installments each year would be substantially lower. In response, council has decided to try to pay the full amount owed each year when possible.

Once the final $164,000 is paid toward the 2012 pension payment, the city will have avoided taking the discount for the first time in years. While Bedont admits he is an optimist, he said at last week's council meeting he is hopeful that the city will be able to avoid taking a discount again this year.

Kristie Linden is an editor for Trib Total Media. She can be reached at or 724-838-5154.

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