Millvale Council has accepted a bank’s terms for loans totaling $2 million, which the borough is taking out after a county judge approved its emergency request in February.
Council voted 5-0 on April 14 to approve two loan commitment letters from First National Bank. Council members Katie Dembowski and Al Atkinson were absent.
One loan is for $1.55 million while the other is for $450,000, borough Solicitor Jack Cambest said.
In February, Allegheny County Common Pleas Judge John T. McVay Jr. approved Millvale’s request to borrow the money after borough officials said they needed it to pay off overdue debts.
McVay found that the unfunded debt came about because Ed Figas, the former borough manager, did not inform council about the borough’s financial condition. Lower tax collections, higher insurance costs, pension obligations and public safety costs contributed to the debt, he found.
Figas, who resigned in April 2025 as part of a settlement agreement, has not been accused of any criminal wrongdoing.
Without the loan, borough officials said they would be forced to shut down all municipal services, putting public health and safety at risk.
Cambest said the $1.55 million loan carries a 5.5% interest rate for 10 years and is nontaxable. The $450,000 loan, to reimburse the borough’s pension fund, is taxable and carries a 6.5% interest rate for three years.
The state Department of Community and Economic Development will need to approve the terms before the loans are finalized, which Cambest said he expects to happen within 30 days. No further action by council is needed.
Millvale will dedicate a portion of its property tax revenue to making payments on the loans.
In a related matter, the borough is beginning to do interviews with candidates for borough manager.
The council in February approved paying Public Partners, a service of the Allegheny League of Municipalities, up to $5,000 to conduct the search for a new manager, with a focus on one with a financial background.
Council President James Machajewski said Millvale received about a dozen applications for the job, from which three or four will be interviewed. He said they anticipate making a hire in May.
The new manager will replace Joe Kypta, the assistant manager and public works supervisor who has been serving as interim manager.
The borough is expected to enter the state’s Strategic Management Planning Program, which is an effort municipalities can take to avoid falling into financially distressed status. The program provides matching grants to help municipalities develop multiyear financial plans and establish short- and long-term financial objectives.