A judge Friday delayed his ruling on Millvale’s emergency request to take out a $2 million loan to fend off a potential budget crisis.
Allegheny County Common Pleas Judge John T. McVay, Jr. said he needs the consultant guiding debt restructuring for the municipality of 3,300 residents to testify before making a decision in the case.
The next hearing is set for Jan. 27 in a Downtown Pittsburgh courtroom.
In an order, McVay said he wants Millvale’s expert on the plan to address details of the debt restructuring.
Michael Foreman, a retired state Department of Community and Economic Development staffer, has been working with Millvale on paying down its debts through an Allegheny League of Municipalities program.
The judge also said he wants to explore whether the borough will need ongoing monitoring.
During a hearing Thursday, McVay said he was “leaning toward” green-lighting the borough’s request, which Millvale officials said is necessary to avoid service cuts and layoffs.
Attorneys representing Millvale told TribLive they hope to resolve the matter in the next two weeks and close on the loan by March.
Millvale officials told McVay they first learned about the looming fiscal crisis early last year.
Ed Figas, who was then the borough manager, was moving money from dedicated funds to plug holes in the budget and pay down debts, Councilman James Machajewski said.
While there were no accusations of any criminal conduct, Figas was removed from the post for not keeping council apprised of the debt, according to borough Solicitor Jack Cambest.
Figas has not responded this week to phone calls.
After Figas’ departure last year, the municipality responded to its financial woes by shutting down all discretionary spending.
State Department of Community and Economic Development staffers came to Millvale to help craft both short- and long-term financial plans.
All expenditures needed to be approved by the interim borough manager, who replaced Figas.
The borough council also increased Millvale’s property taxes 58% last year, its first increase in more than a decade, to help pay debts to utility providers, insurance companies and others.
Currently, the borough owes more than $250,000 on a short-term loan secured in 2024; more than $410,000 in pension costs; nearly $480,000 in utilities and taxes; $200,000 on police vehicles and infrastructure improvements; and more than $225,000 on building and janitorial supplies, personnel, fleet costs and insurance.
If Millvale borrows the $2 million, officials said they’ll save $290,000 every year from its property tax revenues to pay down the loan.
Millvale allocated $4.28 million for expenditures in its 2025 budget, online records show. It also was set to receive an estimated $845,000 in property taxes.
Funds for Millvale’s police force accounted for about a quarter of the 2025 budget and was its single largest expense, online records show. Administrative wages totaled about $505,000.
