A state program aimed at job retention could be tapped to help with the purchase.
By HAROLD GWIN
VINDICATOR SHARON BUREAU
SHARON, Pa. -- If the John Maneely Co. follows through on plans to buy Sawhill Tubular plants here, in Wheatland and in Howland Township (Ohio), the Shenango Valley Enterprise Zone Corp. stands ready to lend some help.
Thomas Stanton, enterprise zone board president, said Wednesday that the nonprofit economic development organization will seek a state grant of $250,000 to help with the project, if Maneely wants the assistance.
Actually, it would be the enterprise zone and the Shenango Valley community that would benefit more than Maneely, Stanton said, acknowledging that any purchase price for the three plants would likely make the $250,000 assistance offer pale by comparison.
It would really be the Maneely Co., parent of Wheatland Tube Co., helping the enterprise zone, he said.
Here's how: The state money would come to the zone as a grant but be loaned to Maneely at a lower-than-market interest rate. It wouldn't be large enough to be a deal maker for Maneely but the payback of that loan would be used by the zone to provide more development loans, he said.
Maneely and A.K. Steel announced in December that Maneely had signed an agreement to buy the Sawhill Tube Division plants. No terms were disclosed. Boards of directors of both companies and regulatory agencies would have to approve the sale.
Stanton said the state grant is available under a new program called New Communities designed to provide support for projects that save jobs.
In the local case, the enterprise zone wants to make sure the 775 Sawhill jobs at the three plants remain intact.
Maneely has indicated it has no plans to close any facilities and is buying the plants with the intent to continue operating them.
Advantage: Getting a New Communities grant could automatically get the local enterprise zone reinstated in the state enterprise zone program for five years, entitling the organization to annual state $50,000 basic grants as well as additional competitive grants, Stanton said.
Shenango Valley was a part of the state program for 16 years until it was forced to leave in mid-2000 when the state announced it needed room to create more enterprise zones.
The local zone became a private, nonprofit corporation to continue its practice of providing low-interest loans for industrial development.