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Nazareth, Pa., United States

Monday, May 05, 2014

John Brown's $2.375 Million Slush Fund

Northampton County Executive John Brown has a $2.375 million slush fund. County Council unwittingly created it when they approved last year's Budget. Unless they take steps to assert some kind of control, he has carte blanche to hand out Walking Around Money, at his own discretion, in the name of economic or community development. It's already started. Let me tell you how this happened.

Naturally, it all starts with gambling. Northampton County's Gaming Authority is designed to prevent hanky panky. It's set up primarily to award grants based on both the negative and positive impact of the Bethlehem Sands Casino, with priority given to the five municipalities surrounding Bethlehem  Most of the money has gone to public safety. You might disagree with a decision here or there, but nine members are making the call in a transparent setting. All of their decisions are made publicly.

Here's the problem. The Gaming Authority has control over only some of the money coming from the casino. It doles out the slots tax revenue. Though that figure is projected to be about $1.6 million this year, there's another gambling stream over which it has no say. That's the table games revenue, which is supposed to be dedicated to community and economic development projects.

It's a healthy chunk of change. Northampton County has budgeted $1 million in anticipated revenue from table games this year, although it will likely be much more. The County is also sitting on $1.375 million in unspent table games revenue. This is a total of $2.375 million.

Where will that money go?

When he was Executive, John Stoffa had pretty much decided that this fund should go to community and economic developments in the smaller communities. But he was unwilling to spend it just because he had it. This explains how the County ended up sitting on $1.375 million in table games revenue.

In his proposed 2014 Budget, Stoffa wanted $400,000 of this table games revenue to go for a job creation grant under the control of the Industrial Development Authority, an independent source of tax-exempt funding for local businesses.

But Council killed that idea. It hated the idea of some outside agency having control of the money. Then Council President John Cusick argued that keeping the money away from the Industrial Development Authority would give Council "considerably more discretion" over how it was spent. Lamont McClure agreed that this must be "in the budget." But paradoxically, by a vote of 7-2, these rocket scientists managed to do the opposite. They created a $2.375 million slush fund for "future grants" by the Executive. In an effort to avoid a slush fund, Council created one.

I never noticed this myself.  I'm an idiot, too. Clearly, their intention was to retain control, but they certainly appear to have handed it over to John Brown.

Only Peg Ferraro and Scott Parsons voted against this dumb idea, as most ideas cooked up during six-hour meetings tend to be.

The Budget approved last year tells us that $3.375 million will be awarded in "future grants", with no additional explanation or breakdown. This opens the door for Brown to pencil in whatever he wants, so long as he claims it is for community or economic development.

He's started.

Now if it were me, I'm immediately schedule a fact-finding mission to Aruba. But Brown is a frickin' Republican, so he's trying to be responsible. No community development junkets to Hawaii forhim. Maybe Notre Dame will have a leadership conference. .

According to The Express Times, Brown is giving Easton $42,000 for a used trolley to cart people all over the place at no cost.  Mayor Sal Panto, whose #1 goal in Easton has been to increase the workforce, thinks this is a great idea. I agree, even though it likely comes from voices behind the throne, whispering into Brown's ear.

Easton already is taking a pretty big bite out of Northampton County. In addition to the commuter tax, the County is paying for the following Easton projects this year: Farmer's Market - $10,000; Greater Easton Development Partnership - $20,000; Historical Society (on Northampton Street) - $40,000; National Canal Museum - $12,000; Nurture Nature Center (Easton) - $10,000; and State Theatre - $42,000.

Because Easton is struggling and has such a high density of low income residents, I believe the trolley is still a very good idea.

But Council members only found out about this after reading the news account. Brown never told them.

Now Council knows. They also know they accidentally created a slush fund. They need to do everything they can to ensure they have the final say in how this money is spent, or that some sort of objective set of criteria is established that will prevent one person from buying good will at election time with the people's money.

His next idea might not be so good.

Blogger's Note: The Express Times states the money for this project is coming from the Gaming Authority. That is inaccurate. The Gaming Authority has approved no such grant, and has no authority to do so.

48 comments:

Anonymous said...

Lest be fair to Brown. this is supposition on your part because you don't like him. John Stoffa held on to some money because of a deal he and Ron Angle made to funnel cash to the slate Belt.

Actually, the money should be moved to county human service needs as originally intended when the legislation was first introduced.

The impact fee has become a grab bag for political favors for people all over the county. Terrible waste of valuable resources desperately needed elsewhere.

In the Loop!

John Blankstein said...

I think a renovated trolley for Easton is a great idea and totally worth a shot at that price; things seem to be going quite well over there. I ad extended family in town a couple weeks ago and they really enjoyed Sunday Brunch and a relaxed stroll through the downtown.

Anonymous said...

Because this blog and the words in it pass over the wires and into Easton, Sal will want to Tax every word!
Poor Sal and all of Easton's poor people but you can still get a good bj and score some dope on your way to fill up your gas tank in NJ.

Anonymous said...

Money well spent. Now the next question,.....since the county has agreed to pay, will the trolley allow for political signage to be displayed on the side? I'm sure those candidates seeking signage will pay a terrific price to campaign on the trolley! It will be one big political machine on wheels.

Love it!!!!!

Anonymous said...

The Pa legislature gave Easton and cities like it two remedies which result in commuter tax. The first, gives pension distressed communities such as Easton the right to use a commuter tax. The second gives communities such as Easton the right to use a commuter tax if it declares distress under act 47 (bankruptcy). A commuter tax is one of the few remedies that a judge can authorize to keep a distressed city afloat. If you do not like these choices, then ask the legislature to approve another method.

As far as the county goes. I would agree that grant disbursements to Easton should demonstrate an improvement to the city's overall financial health-job creation or improved real estate value. I am not sure how investing money into a farmer's market or a trolley or etc, does that. I will not criticize and am open to education on the matter. Obviously investments in Easton's economy will wean it off the commuter tax and serve the county better. But, is a trolly such an investment?

commuter taxpayer

Anonymous said...

It's not a slush fund and Council does have some control. They will still need to approve a budget amendment for this expenditure later this year.

Anonymous said...

No big deal. Used trolley that will have the desired economic impact for a Norco community. But other deals should be scrutinized more closely. And council has the right to know how the money is being spent.

Anonymous said...

Well, anything is better than Stoffa's idea of giving the money to the "smaller communities". Sure, where no one lives - lets ignore where everyone DOES live.

Anonymous said...

So this is a trolley car with a gasoline engine that drives around like a bus, right?

Install an actual trolley and I'd be on board.

Anonymous said...

The money that comes directly to Northampton County from the Gaming Authority was placed into the General Fund of the County to maintain a lower tax rate. If Mr. Brown thinks this is walking around money he is sadly mistaken.

If he SPENDS the money on Trolley's every tax payer in the County will feel the pain when taxes need to be increased.

Mr. Brown needs to start surrounding himself with people that understand finances.

Anonymous said...

Why gi e the money to the Industrial Development Authority when they are not trying to bet FEDEX to build on Bethlehem Steel Property off route 412 in Helletown. Why ruin good farmland when you can reuse industrial property.

Bernie O'Hare said...

1:44, There is no supposition in this story. I have a link to the Council minutes removing the money from the IDA and a linkto the approved budget showing this vast sum as approved "future grants." I know the source of funds is table games. I know the Gaming Board has nothing to do with it bc a grant like this from them would be illegal. You don't put the money where originally intended, but where the law allows it to be put.

Bernie O'Hare said...

John I have no quarrel with this project, but think Council needs to tell the Exec they want some say in how the money is spent.

Bernie O'Hare said...

7:00, I would argue that most of the new business in Easton is small business and restaurants, and that a trolley would increase clientele, increasing business. Panto is all about creating jobs, so I can see this as a good thing. My only concern is that Council have some say and that there be a public application process instead of handouts to favorites.

Bernie O'Hare said...

7:24, No they will not. The money is accounted for in the approved budget as a "future grant." Council has lost control.

Bernie O'Hare said...

"o this is a trolley car with a gasoline engine that drives around like a bus, right?"

Yes, nobody is going to spend a gazillion dollars bc you want to see a choo choo.

Anonymous said...

"Me thinks something is rotten in Denmark"... Brown is rotten with secret deals. You have said it before Bernie. There is a total lack of transparency with this administration. Watch out for the next rabbit that comes out of Brownie's hat!

Anonymous said...

I buy into the concept that suggests that the county will open their parking lots to the public an the trolly will ferry people to and fro those lots. Obviously increased parking availability increases foot traffic and spending. But, that was Brown's idea. I seriously question county money going to street festivals which have low economic return and little tax revenue. They are nice and raise community pride. If county dollars were spent to cleanup a vacant lot in a commercial district, property values are enhanced and businesses are attracted which grow jobs. That's the better choice for county dollars.

commuter taxpayer

Bernie O'Hare said...

I look at Panto's stewardship of Easton. He has truly turned the City around, and without a NIZ, arena, baseball stadium or hockey arena. It has been a slow process that starts at the bottom. So if he thinks this helps Easton's economy, I support it. In fact, if done right. It can take county workers downtown for lunch.

Sal Panto, Jr. said...

Bernie, thanks for shedding the light on the source of the money for this grant. I thank John Brown for his vision in awarding this grant because he sees the value in enhancing the tourism economy in the Valley.

The trolley is a hop-on/hop-off trolley for the purpose of making it more convenient for visitors to use remote parking lots on the out skirts of the downtown. Its about convenience.

And yes its about JOBS. Every restaurant that opens creates another 60 -80 jobs. And these are good paying jobs when you account for tips. Other jobs are created by offices and stores who see a progressive city willing to find solutions to problems. It's great that we have a parking problem because for many years there were plenty of empty spaces.

And yes, it will increase the number of visitors because the trolley will make it convenient to get to and from our beautiful theatre, our fabulous restaurants and our increasing retail stores (more than 50 in the last two years --- AND STILL OPEN.

What this has done is increase the city business tax revenue by more than 25%. Increased revenue from businesses in the form of business tax and parking revenue has allowed us to maintain our real estate tax rate without an increase.

Unfortunately Easton doesn't have the area like and Allentown or Bethlehem or surrounding townships where new businesses can be located. For that reason in 2007 I made the commitment to build Easton's economy on the arts, entertainment and tourism. And we are successfully doing just that.

As for political signs on the trolley, well that is just stupid talk because obviously that will ever happen and all advertising displayed will be Easton attractions and businesses.

I agree that there may be a need for some control on the dollars and I am confident that now that you have brought this matter to the attention of the Executive and Council that controls will be put in place.

For the naysayers here that continually put Easton down -- well you obviously haven't visited us lately. I invite you to come down and see the wonderful things happening in your own backyard.

Anonymous said...

That makes all the sense in the world if you run the trollies at night when most people want to go to the restaurants and cannot find parking spaces

commuter taxpayer

Anonymous said...

Yes, nobody is going to spend a gazillion dollars bc you want to see a choo choo.

Then why not use a bus? I don't want to see a cho0-choo. I'd like to see us use something that doesn't spew more smog to simply drive people two blocks because of some fear of the bogeyman.

Anonymous said...


For the naysayers here that continually put Easton down -- well you obviously haven't visited us lately. I invite you to come down and see the wonderful things happening in your own backyard.


Easton is awesome, Mr. Mayor! Seriously.

But an electric trolley would be even MORE progressive. Go the distance.

Anonymous said...

@ Sal Panto,
What happened to the $883,000.00 that you already for from the table games last year or the $135,500.00 that you got this year already?

Why do you need 40 grand when you have already been given 1 million in the last 16 months?

Sal Panto, Jr. said...

Anon 12:36PM -- again you show your cowardly way with the use of "Anon." Even so I will answer your question. Simply because we can!!! We will seek any funding available to help move our city forward -- just like every other community. Sorry but if you don't think that is fair then tell your local officials to apply.

River said...
This comment has been removed by a blog administrator.
Anonymous said...
This comment has been removed by a blog administrator.
Bernie O'Hare said...

I accidentally deleted a Sal Panto criticism that is anonymous, but not personal. Here it is:

@Sal Panto -- How did you apply for this 40,000 for the trolley if this is a John Brown slush fund. You should have said have local officials Brown Nose the county Exec and you too can get a trolley for your town.

I hope to close this years budget gap you reach into the pockets of Eastonians before anyone else.

Also how does a restaurant down town mean 60-80 jobs. Most restaurants employ 20-30 people. I'm sure Maxim 22 does not employ 60 people. Not even close. I also would find it hard to believe Porters employs that many folks.

Love the Anonymous Coward

Bernie O'Hare said...

I intentionally deleted a comment from Henry Schaadt, who likes to call himself River. Nothing he posts here is welcome.

Bernie O'Hare said...

Sal is effectively representing his City's interests and I believe this is a good idea. My concern is to put something in place to prevent abuse.

Anonymous said...

A trolley? Well, we've certainly found something that only government can do in order to qualify as an expenditure from the "slush fund". Or maybe it's only something that government WOULD do.

Here I thought Northampton County was operating on a tight budget.

I want the county to start a unicorn farm. Imagine the economic impact from all the visitors to the unicorn farm. People would eat at our restaurants, stay at our hotels, and maybe even fill their gas tanks at local stations. Plus, the farm would generate thousands of family-sustaining jobs!

I hope none of you meanies are against unicorns! What kind of monster could be?

Anonymous said...

How about a paranormal museum downtown? Kreskin could help with the grand opening. Sal and Brownie could pull a unicorn out of his ass. Just like Brown runs the county.

Anonymous said...

Why not start using the money for what it was initially intended, Human Services. The casinos increase the strain on services in many ways. Also the county has fallen behind ion funding needed services to make up for state rollbacks. Yet Both Stoffa and Brown use it as a slush fund for their buddies throughout the county.
Easton needs more services people don't receive than a trolley. Let the business owners chip in for it.

Anonymous said...

These funds are specifically targeted and must be spent on community and economic development not human services. The issue here isn't the grant or its usefulness, but how Brown went about awarding it. What he should have done is presented this as a proposal to the Council Economic Development Committee and gotten feedback. It probably would have passed easily, but he continues to operate in secret.

Besides, Northampton County is putting an extra $5 million into a non-mandated human service called Gracedale.

Anonymous said...

Sal called those who get tickets from his very aggressive parking enforcers, lawbreakers. What a disingenuous hack. Doesn't Easton generate almost a million bucks a year from parking? They can afford their own trolley. He and this kind of slush fund are why politicians are more hated than dog shit. He should pay his bills but he doesn't. He's a chip of the old block in this regard. What a mess.

Anonymous said...
This comment has been removed by a blog administrator.
Bernie O'Hare said...

What a disgusting person you are!

Anonymous said...
This comment has been removed by a blog administrator.
Anonymous said...

4:29am
You are as full of shit about the Bethlehem township building as you where 2 years ago. If u hate the county so much, quit your job, and go work in the private sector.

Anonymous said...

Hey let's charge the trolley users for parking in the county lots. The city charges us to park on the street at the courthouse to balance it's budget

Anonymous said...

Sal Panto will be the next county executive and a good one. sorry haters.

Anonymous said...

Sal Panto will be the next county executive and a good one. sorry haters.

Anonymous said...

How come no one has asked the bigger question, if this is "slush fund" money with little to no oversight, How long before Cathy Allen is given a position funded out of this account. And dont be too quick to say this couldnt happen, it is very easy. Just make up an official sounding title and fund it for the next 3 years.

Anonymous said...
This comment has been removed by a blog administrator.
Anonymous said...

Truth is that the Norco taxpayers are subsidizing a function that is provided by the private and nonprofit sector to the tune of $5 million. Gracedale has eaten up the fund balance. Nursing homes aren't mandated, and they aren't provided in 2/3 of the counties in PA.

taxpayer

Anonymous said...

Thank God for Gracedale it's one of the finest nursing homes in the country. I'm happy to pay whatever taxes to keep it.

another taxpayer view

Anonymous said...

"Nursing homes aren't mandated"

Neither are millions of dollars worth of other services the county provides. Should we dump them and cut funding as well?

Stop drinking the big scam Kool-Aid

another taxpayer

Anonymous said...

I have lived in Easton my entire life and personally like Mayor Panto.

What bothers me about his first post is the statement concerning not increasing property taxes.

True. He hasn't rasied property taxes. However, the local tax rate is the highest (by far) in the Lehigh Valley. I pay 1.95% of my salary for local taxes. My wife does the same.

We are currently looking to relocate out of the city for this reason.

I can move to Palmer and pay 1%. More than enough difference to pay for the added real estate taxes and have extra disposable income.