Allentown Advances Bond Plan for City Projects
ALLENTOWN, Pennsylvania – Allentown is progressing with a plan to borrow millions by issuing bonds to investors.
During a meeting on Wednesday evening, the City Council reviewed a proposal to issue bonds valued at up to $134 million for various capital initiatives, including the funding of a new police and fire headquarters.
Despite some resistance, the city administration received approval from the council and is moving forward with its plan.
The city intends to issue bonds through private negotiations with major investment firms that handle the city’s financing, such as RBC Capital’s Raymond James and Stifel. These bonds will be sold in stages over a few years, which should help manage immediate debt and align with construction timelines. Approximately $41 million is expected to be released in each of three sales from 2026 to 2028, as per the city’s financial presentation.
Officials note that the funds from these bonds are aimed at enhancing and maintaining vital infrastructure, public safety facilities, parks, and other urban resources in the years ahead.
Before seeking funds on the market, the city management will present a spending plan to state and federal partners.
“It’s like getting pre-approval for a loan,” Mayor Matt Churk explained. “We ensure that creditors are ready to lend a specific amount for capital projects, clarifying our plans for borrowing.”
Interestingly, the city might not require the entire $134 million. This figure is just the maximum they can request. The borrowed funds will be repaid over time, with the council holding the authority to sign off on project plans using this money.
The upcoming Capital Improvement program for 2026-28 is projected to allocate $21 million for new or renovated police headquarters and $65 million will be designated for the Life Safety and Wellness Center, which will support Central Fire, EMS, and Health Services.
Recent discussions at City Hall have turned to facilities like the existing Central Fire Station, originally a car dealership from the 1920s, converted into a fire station in 1946. The EMS headquarters, over a century old, faces issues like roof leaks, mold, and overcrowding.
“What do we do when a hurricane takes the roof off?” asked EMS Operations Chief Mehmet Barzev. “Honestly, we don’t have a plan.”
The proposed Life Safety and Wellness Center will be located at 4th Avenue and Turner Avenue, covering 65,000 square feet to integrate fire, EMS, and health services aimed at addressing safety and accessibility challenges.
Additionally, the city plans to use the funds to improve police stations, parks, and streets.
While councillors acknowledge the necessity for upgrading these facilities, several financial concerns arose during the meeting regarding the bond issues.
Councillor Ed Zucal presented a depreciation chart that suggested the city could pay a staggering $218 million in interest on top of the $134 million borrowed, culminating in a total of $352 million over 30 years.
“If we support this, we’re putting the city in jeopardy,” Zucal expressed. “We’re essentially risking its future.”
“Don’t get me wrong. There’s a consensus on wanting a new public safety wing or police station. But this isn’t the solution,” he added.
In response, Councillor Santo Napoli defended the need for the bonds, emphasizing that considering the city’s positive financial trajectory, it might be feasible.
“There’s clearly interest in these projects,” Napoli noted. “They are going to be relevant for the next 50 years, and we must contemplate their impact on future generations.”
He made a comparison, stating, “When you buy a $200,000 house with a 30-year mortgage, you end up paying $223,000 in interest. Does that deter people from homeownership? No, because we often need borrowing.”
Residents raised concerns about the potential for tax hikes to cover the debt during the public comments segment.
“In my view, taxpayers will end up paying more and will carry this burden,” a resident stated. “I think you really need to reconsider this whole approach.”
Zucal proposed a motion to restrict the bond issuance solely to the police and fire departments.
Ultimately, the Council unanimously approved the full bond issuance.
