Save Our Steel in the News

Bethlehem rivals jostling for power

Significant city issues create political battles between Dems looking toward 2005 primary.

By Matt Assad and Chuck Ayers Of The Morning Call

May 30, 2004

Bethlehem Mayor John Callahan can peer out the window of his second-floor office in City Hall and see 120 acres of old Bethlehem Steel property that represent a big part of the city's future.

Redeveloping the land could bring a half-billion dollars in investment and thousands of new jobs, but for nearly six weeks after he took office, the new mayor could not get the Philadelphia developer on the project to return phone calls.

Yet a stack of news stories piling up in his clip file had his political rivals, council President Michael Schweder and state Rep. T.J. Rooney, not only meeting with Delaware Valley Real Estate, but serving as the company's spokesmen.

It wasn't supposed to be like this.

After a tough Democratic primary that he narrowly won over interim Mayor James Delgrosso — Schweder and Rooney's candidate — and an overwhelming victory in the general election, Callahan took office in January. Yet less than three months into his term, he was wrestling with fellow Democrats for control of the city's most important economic development project.

Part of that can be blamed on the unusual scenario that has Callahan finishing the last two years of the term of former Mayor Don Cunningham, who left office last year for a Cabinet post in Harrisburg. Another Democratic primary will come next May, which means the two rival Democratic factions will keep fighting for a leg up.

It's a fight that already has affected every significant issue since Callahan took office.

Consider:

A fight over how to pay off a $7.9 million federal court award against the city ended up with a veto by Callahan, a veto override by City Council, a $200,000 cut in the budget and a 0.5-mill tax increase for property owners.

Debate on the 2005 budget is five months away, but the rival factions already are arguing over whether employees will be laid off.

The redevelopment of former Bethlehem Steel land, now owned by International Steel Group, has turned into a battle over who gets credit for jump-starting the project that represents the city's future.

The tug of war hasn't gone unnoticed by council members trying to walk a fine line between the warring groups. Councilmen Gordon Mowrer and Robert Donchez say they won't sit idly by and let civil war tear apart City Hall.

''Gordon and I have met to talk about what's happening, and if it starts hurting the city, we intend to be vocal about this,'' Donchez said.

''I remain friends with both factions, but we cannot allow this to bring the city down. We cannot allow this to halt the momentum we have in economic development.''

Politics or philosophy?

Cunningham, who spent much of his six years as mayor jousting with Rooney and Schweder, said in past years that such disputes would have been resolved through compromise. But that doesn't seem possible this year.

''This isn't about philosophical differences or what's best for the city,'' Cunningham said. ''It's about power and control — nothing more.''

Fueling the fire is a possible mayoral bid by Schweder, who coyly sidesteps the issue, but has been mentioned in political circles as a likely challenger to Callahan.

Schweder and Rooney say they aren't part of a cabal scheming to undermine the Cunningham-Callahan alliance before next May.

''I would say that's a totally inaccurate characterization,'' Schweder said. ''I don't know of any faction that I belong to in the city of Bethlehem.''

Rooney said people are mistaking philosophical disagreements for political shenanigans. ''When people disagree for legitimate reasons, that's part of the democratic process,'' he said. ''There's no political agenda here. I just want to get things done.''

Callahan said: ''I'm not going to be dragged into this political battle.''

But the battles have come, nonetheless.

Political blame and credit

Many battles have been waged in the area of economic development.

During the campaign of 2003, every candidate, including Callahan, labeled the redevelopment of the former Bethlehem Steel plant lands as the city's top priority.

After failing to return the new mayor's phone calls, Delaware Valley, the developer believed to be undertaking the Bethlehem Works project, finally agreed to meet with Callahan in March. Less than a month later, Delaware Valley pulled out of the project, a move city officials and ISG had expected for months.

More recently, the battle for control of Bethlehem Works — and the political hay for getting the project going — nearly roped Gov. Rendell into the fray. Both Cunningham and Rooney have close ties to Rendell: Cunningham is the governor's director of the Department of General Services, and Rooney was handpicked by the governor to be the chairman of the state Democratic Committee.

On Friday April 23, one day before Rendell was to appear in visit Bethlehem as part of a statewide tour, Rooney received word from New Jersey developer Michael Perrucci, a longtime ally and friend who had contributed to Rooney's campaigns, that Perrucci had an agreement of sale for the Bethlehem Works land.

Callahan didn't even know Perrucci was negotiating for it.

Rooney, who accompanied the governor on the bus tour, wanted Rendell to make a major announcement on the sale the next day when he made an appearance at a news conference — with Rooney and Schweder at his side — at OraSure, next to the Bethlehem Works site.

Callahan caught wind of the announcement late that Friday, and not knowing Perrucci or what he planned for Bethlehem Works, didn't want the sale made public, especially if Schweder and Rooney were poised to take credit for it.

Callahan enlisted Cunningham to lobby Rendell not to make the announcement.

Rooney supporters say it was Rooney, in an act of good faith, who pulled the plug on the governor's announcement. Callahan supporters say it was Cunningham and his lobbying of Rendell that halted it.

Either way, Rendell found himself in the middle — and did not to announce the sale.

''The governor knows there is a T.J. -Schweder/Cunningham-Callahan rift,'' state Sen. Lisa Boscola said. ''The last thing the governor needs is T.J. calling wanting one thing, and Callahan calling and wanting another.''

Boscola said she fears that the bickering and political hijinks could end up costing the city funding for its most-coveted projects from the highest level of state government.

''It's stopping from making the decisions about economic development projects as quickly,'' she said, pointing out the delay in the Perrucci announcement. ''It has the potential to disrupt these projects if it doesn't stop.''

Rooney and Schweder supporters say the political gamesmanship has not been one-sided. When City Council appointed Callahan's main primary opponent, Delgrosso, as interim mayor in March 2003, Cunningham vowed to use his influence with Rendell to see that not ''one dime'' of state grant money came to Bethlehem while Delgrosso served the nine-month term.

Not a penny did.

But days after Callahan's Jan. 5 inauguration, Rendell showed up with a $1.6 million check to jump-start the Bethlehem Commerce business and industrial park on former Bethlehem Steel land.

The euphoria of that day was short-lived. In March, a five-month federal civil rights trial of a botched drug raid in 1997 ended with a $7.89 million judgement against the city. To pay the settlement, Callahan submitted a plan to float a bond issue calling for no payments next year — when he's running for re-election — and the largest payments to be delayed until after 2012, after Callahan would be out of office.

Almost immediately, Schweder called Callahan's handling of the case the ''most stupid'' he'd ever seen, and former city solicitor Joseph Leeson led a City Council charge to strike down Callahan's repayment plan.

Leeson's plan to fund the settlement over 12 years would save taxpayers $700,000, but it probably would force a 0.5-mill tax increase next year. Callahan vetoed the payment plan, but it was easily overridden by the Schweder-led council.

The political fighting has been in high gear ever since.

There will be no shortage of key issues to fight over between now and next May.

Now that Perrucci and a team of deep-pocketed New York investors have an agreement to buy the Bethlehem Works site, how that land is developed — and how quickly — could depend on whether warring politicians can find ways to compromise.

''Sometimes it's just a testosterone thing, sometimes it's a territorial thing, but this has got to stop. We cannot afford to wait for another two years to pass before acting on Bethlehem Works,'' Boscola said. ''If we all thought more about our constituencies than our egos, then we'd put the best interests of the city first.''

The two sides also will be put to the test next month over the administration's proposal to rezone a portion of Schoenersville Road to make way for a hotel; to use public money to help fund a parking garage in the Lehigh Riverport apartment and retail complex in the former Johnson Machinery building; or possibly to fund a minor league baseball stadium.

Perhaps the biggest battle looms in October when council and Callahan will begin debating a 2005 budget that will establish how much tax Bethlehem property owners will pay next year, and could determine how many city employees are laid off to balance the budget.

For now, Mowrer prefers to see the political horizon for the potential it has to offer rather than the hostility it will almost certainly generate.

''We're going through a tough time right now, but this city has so much promise,'' Mowrer said. ''We'll survive this ugliness. We always do.''

Copyright © 2004, The Morning Call