New Developments With Penn Lake Dam Project

Updated April 12, 2021


Borough Council Votes on Dam Loan Financing
On March 24, Michael Judge of Casecon, the firm that has been helping the Borough Council line up loan financing, briefed  Borough Council on the funding options offered by two local banks in response to the RFP that Casecon sent on the Borough’s behalf.
Luzerne Bank offered:
  • 3.3% fixed for 20 years; or
  • 2.75% for 10 years, then reset to 79% of prime
  • Interest only draws for 2 years
Mauch Chunk Trust offered:
  • No fixed rate for 20 years
  • 2% for 5 years, then reset to 50% of prime
  • Interest only draws for 2 years
A “Special Council Meeting” was advertised and then held on March 26 to discuss and vote on these two funding options.  The Borough Council unanimously voted to move forward with the offer from Luzerne Bank, noting that the 2.75% rate was less than the 3% the Dam Advisory Group used for planning purposes.   While the 2% rate from Mauch Chunk Trust was attractive, the Borough Council was not comfortable with the 5 year reset, noting that the bulk of the borrowing would be in year 3 (when actual construction will be occurring), and thus there would be only 2 to 3 years at the favorable rate.
On April 8, Luzerne Bank’s Credit Committee approved the loan with the caveat that the Borough obtain a tax exempt opinion from an attorney before the loan is finalized.  Casecon is currently arranging for such an opinion.

RFP for Pre-Construction Engineering Services Ready to Be Sent

The completed RFP was sent to Pennsylvania DEP for final comments.  The Director of Dam Safety responded that the RFP was very thorough and he had no additional comments.  Final touches on the RFP, (such as dates and to whom responses should be directed), were made. It is scheduled to be sent to approximately 18 engineering firms and will be placed on Penn Bid on April 19.  A mandatory pre-proposal meeting/site visit will be held on May 4.  Proposals are due May 28 and the Borough Council expects to select the engineering consultant for this phase of the work by mid-June

Special Thank You to Long-time and New Volunteers

For several decades Penn Lake residents Rick and Bob Johnson have been doing monthly piezometer readings at the dam.  This week they turned over this responsibility to two younger Penn Lake residents, Richard Campbell and Pat Knueppel.  A piezometer is used to:

  • measure pore-water pressure and ground water levels (high pore water pressure can lead to total failure of the load-bearing capacity of the soil);
  • determine the level and flow pattern of ground water;
  • determine the flow pattern of water in earth/rock fill, concrete dams and their foundations; and
  • delineate the top flow line of a saturated soil mass.

The Borough is very grateful for these volunteers who do these important tests in all kinds of weather!


Stay Informed! 

The Dam Advisory Group is committed to keeping the community informed of developments with the dam project as they occur.

Questions about the dam project?

Email your questions to the Borough secretary at plpborosecretary@yahoo.com and they will be forwarded to the Dam Advisory Group.

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Sign up at the bottom of this page to receive e-mail updates about the  dam project.


Click images to enlarge.

Drained Lake Gallery 2006

Photos taken October, 2006

Background Information/Timeline of Dam Project

Pennsylvania Department of Environmental Protection Says Penn Lake Dam is Unsafe

On March 30, 2020 Penn Lake Borough was notified by the PA Department of Environmental Protection (DEP) that it had designated Penn Lake dam as Unsafe. This designation does not mean that the dam is at risk for imminent failure.  But, it is 115 years old and does not meet the requirements of the Pennsylvania Dam Safety and Encroachment Act.  It is classified by the DEP as a “High Hazard Dam” because there are numerous homes that would be risk downstream if the dam failed.


In April 2020 the Dam Advisory Group was formed.  The purpose of the group is to guide the Borough in responding to the deficiencies outlined by the DEP and to keep the community informed of developments to address those deficiencies.  The group distributed the following pamphlets to the community.

VIEW THE QUESTIONS & ANSWERS DOCUMENT

VIEW THE “What’s Happening With The Dam?” DOCUMENT


In May 2020 the Borough contracted with Borton Lawson Engineering for a comprehensive assessment of the dam and to recommend repair alternatives and estimates of probable costs.  Borton-Lawson provided their report to the Borough on July 31.  That report and assessment was also sent to the PA DEP.  The least expensive alternative to address the dam deficiencies is estimated to cost $1.9 million.


On August 13, 2020 the Borough Council passed a resolution to place the following question on the ballot for the November 33, 2020 election.

Shall debt in the sum of up to $3 million dollars for the purpose of constructing and maintaining a dam to control and conserve Penn Lake be authorized to be incurred as debt approved by the electors of the Penn Lake Park Borough?

This ballot question is required because the Borough Council cannot legally incur debt over a certain amount without the approval of the community.


On August 19, 2020 there was a meeting with the PA DEP.  The DEP has no concerns with the $1.9 million solution and is not requiring us to drain the lake prior to the commencement of dam construction.


On September 3, 2020 a public meeting was held at the ballfield to inform the community about the developments with the dam and to get community input. If you were unable to attend the meeting, you can view and hear a recording of it here:

VIEW AND HEAR RECORDING OF MEETING


A public Q&A Session with the Dam Advisory Committee was held on October 10.  If you were unable to attend, you can hear a recording of the session by clicking on the links below.

October 2020 Public Q&A Session – Part 1

October 2020 Public Q&A Session – Part 2

October 2020 Public Q&A Session – Part 3

Written answers to questions submitted prior to the meeting are available here.


On November 3, 2020 the referendum authorizing the Borough to incur debt up to $3 million to address the dam deficiencies identified by the DEP was overwhelmingly passed by the voters in the Borough, 222-23.


In mid November, 2020, the Borough submitted two grant applications to PEMA:  1.) a BRIC (Building Resilient Infrastructure and Communities) grant which was submitted as a two-phase project with a total request of $9,877,000; and 2.) a FMA (Flood Mitigation Assistance) grant for a project plan development request of $301,000.

PEMA review of the applications began on December 15.

On January 29 we were notified that both of our applications made it through PEMA review and have been submitted to FEMA.   FEMA decisions probably won’t be announced until late spring or early summer 2021.

On February 16, 2021 Rep. Matt Cartwright (D. – 8th Dist. Penna.) sent a letter in support of our BRIC application to the Senior Official Performing the Duties of FEMA Administrator.


In January 2021, Richard Reisinger, DEP Dam Safety Director, asked for a status report. The Borough responded that:

  • an RFP for pre-construction engineering services is being developed by members of the dam advisory group and should be ready in early February;
  • a second RFP is planned for detailed design work which we estimate will be awarded sometime in the summer;
  • two FEMA grant applications were submitted;
  • the referendum allowing the Borough to borrow up to $3 million to address the deficiencies identified by the DEP was overwhelmingly passed by the voters in the Borough;
  • the Borough set 4.6 mils as the tax rate for 2021, with 4.2 mills dedicated by ordinance to dam repair and debt service;
  • the Borough expects to spend $200,000 for engineering services on the dam project in each of 2021 and 2022 and construction will likely begin in 2023.

In January 2021, the Borough signed a contract with Michael Judge of Casecon  to assist in securing financing for the dam project.  An RFP was sent out to 18 financial institutions.  Luzerne Bank and Mauch Chunk Trust responded.  On March 24, Mr. Judge reviewed those responses with Borough Council.

On March 26, 2021 Borough Council voted to move forward with the offer from Luzerne Bank.  Luzerne Bank offered a 3.3% fixed rate for 20 years or 2.75% for 10 years that will then reset to 79% of the prime interest rate.  On April 8, 2021 Luzerne Bank’s Credit Committee approved the loan with the caveat that the Borough obtain a tax exempt opinion from an attorney before the loan is finalized.  Casecon is currently working to obtain that opinion.


On Friday, February 12 members of the Dam Advisory Group met via Zoom with Richard Reisinger, Chief of the Division of Dam Safety for the Pennsylvania Department of Environmental Protection, to review the status of the dam project.  The RFP for the investigation phase of the pre-construction engineering services, which was put together by members of the Dam Advisory Group, was shared with Mr. Reisinger and we informed him of the grant applications we submitted.  He was very complimentary of the work done in preparing the RFP, offered to review any further changes to the RFP and encouraged us to keep the project moving forward. Prior to the meeting, he informed us that he did not believe that any of the Pennsylvania Act 13 grant programs would be a fit for our dam project.

On April 19, 2021 the RFP for Investigation Stage of Pre-Construction Engineering Services Will Be Issued. A mandatory pre-proposal meeting/site visit will be held on May 4 for firms that plan to enter a proposal.   Proposals are due May 28 and the Borough Council expects to select the engineering consultant for this phase of the work by mid-June, 2021.