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Peace in the Valley?



Published: Fri, October 9, 2009 @ 12:00 a.m.

By David Skolnick

The involvement of city council members ‘was damaging’ to the negotiations, Girard’s mayor said.

YOUNGSTOWN — Girard stands to make millions of dollars if V&M Star Steel decides to build a $970 million expansion, but James Melfi, its mayor, wanted more for his city and is not happy with a deal reached to help bring that project here.

“I will never be pleased with how this worked out,” Melfi said Thursday.

Girard and Youngstown reached a deal late Wednesday to share the 2.75 percent corporate-profit tax that would come from V&M’s potential expansion. They had earlier agreed on how to split the income tax paid by workers.

Girard City Council will consider the agreement at its Monday meeting. The Youngstown Board of Control will vote on it Tuesday. An official signing ceremony is planned for Wednesday.

The deal came late Wednesday after about 51‚Ñ2 hours of negotiations.

“It’s fair and equitable,” Youngstown Mayor Jay Williams said.

At issue was determining the average annual profit tax paid to Youngstown by V&M for its current Martin Luther King Jr. Boulevard plant. That amount would determine how much additional revenue from the 2.75 percent corporate-profit tax would be shared between Youngstown and Girard if the addition is built.

The lower the average number, the more money Girard would receive.

Youngstown wanted to use $4.105 million as an average amount paid each year by V&M. After that was rejected by Girard, Youngstown reduced the amount to $3.95 million a year. The two sides agreed Wednesday on $3.85 million, Melfi, Girard Councilman Joseph Shelby, D-at large, who served as council’s representative during the V&M negotiations, and others involved in the negotiations confirmed to The Vindicator.

Melfi had wanted the figure to be $3.325 million a year.

If V&M builds the expansion here, any amount of annual corporate-profit tax it pays over $3.85 million would be split evenly between the two cities.

Under the deal, about 191 acres of land in Girard — that Youngstown purchased earlier this year — would become part of the city of Youngstown. V&M officials insist any potential expansion be on property owned by and located in Youngstown. The land remains in the Girard school district, which would receive about $1 million to $1.2 million annually in property taxes, Melfi said.

V&M expects to decide by December or January whether it will move forward with the project. The company would hire about 400 new workers. Officials with V&M’s parent company in France plan to meet Thursday to discuss the project.

Youngstown and Girard officials said V&M wanted the land transfer to be done in late August.

“I’m embarrassed it took as long as it did,” Shelby said.

The councilman said he was “very disappointed” with Melfi’s comments to The Vindicator that were critical of the negotiations.

“It could have been very damaging,” Shelby said of Melfi’s statements. “It still could be damaging.”

Melfi had previously criticized Youngstown city officials, V&M Star, the Youngstown/Warren Regional Chamber and U.S. Rep. Tim Ryan for their involvement in the negotiations.

On Thursday, Melfi added members of Girard City Council, particularly Shelby, to his list.

Having council involved “was damaging to the process,” Melfi said. “It’s the job of the administration to negotiate for the city. Joe Shelby lacks the experience necessary. It was a burden to have him there. It hurt our side.”

Girard council members would have agreed to anything offered by Youngstown, Melfi said.

When asked about Melfi’s comments about him, Shelby said: “I’ll take the high road on this one. It was very complicated. From the very beginning, the majority of council approached this as if everything we were told may be true. The mayor approached this from the very beginning that everything we were told was not true.”


V&M STAR STEEL Project time line

City officials with Youngstown and Girard have agreed on sharing tax revenue from a potential V&M Star Steel expansion. The time line that led to the deal:

Nov. 26, 2008: The Vindicator learns that V&M is talking to the Ohio Environmental Protection Agency about a $970 million expansion on a site that straddles Youngstown and Girard.

Dec. 8, 2008: The Ohio Tax Credit Authority approves tax incentives of $2.6 million for V&M’s proposed expansion.

Dec. 18, 2008: Youngstown signs purchase option deals with three companies to provide V&M with the land it needs.

Feb. 9, 2009: Youngstown City Council agrees to spend up to $5 million to buy the property, nearly all of it in Girard, with V&M agreeing to pay the money back to Youngstown even if the expansion plan falls through.

March 4, 2009: The Public Utilities Commission of Ohio approves a request from V&M to receive discounted electricity at its proposed expansion.

April 9, 2009: The Vindicator reports that V&M has laid off about 50 workers, reduced the hours for other 400 employees and postponed its decision on expanding because of a financial downturn. A decision by V&M is delayed until December or January.

Aug. 14, 2009: A dispute arises over changing boundaries at V&M’s insistence to have all of the property for an expansion located in Youngstown. Girard Mayor James Melfi objects to the loss of land.

Aug. 19, 2009: Youngstown and Girard officials meet with Roger Lindgren, V&M’s president, to discuss the deal. Lindgren tells the officials to settle the dispute by Aug. 28 or the company would look elsewhere.

Aug. 24, 2009: The two cities reach a tentative agreement.

Sept. 21, 2009: Youngstown Finance Director David Bozanich says there are “some minor issues” with Girard that need to be worked out.

Sept. 28, 2009: Girard City Council is to finalize the deal, but concerns on the part of city officials leave council to pass only a resolution in support of the agreement.

Monday: Girard Mayor James Melfi said “there’s no progress” in negotiations and no deal is in sight.

Tuesday: Both cities acknowledge how to fairly share the 2.75 percent corporate-profit tax from a V&M expansion project is holding up the deal.

Wednesday: Officials with the two cities meet for about 51‚Ñ2 hours and resolve the corporate-profit tax dispute.

Next Monday: Girard council is to vote on the deal.

Tuesday: Youngstown Board of Control is to vote on the deal.

Wednesday: Officials with the two cities are to officially sign the agreement.

Source: Vindicator files


Comments

1Lifesnadir(164 comments)posted 4 years, 6 months ago

Isn't it time for Girard Mayor, James Melfi, to resign? Isn't it time for the people of Girard to speak up and get this arrogant personality out of Girard's government? Mr. Melfi does not seek cooperation, only adulation. He doesn't seek productivity, only self-praise. He is never part of the problem--everyone else is! He is NOT nice, to the citizens or to the people he heads-- his own "Council". Last I knew "council" defines a cooperative effort through opinion, discussion, debate, support, and individual's votes of conscience and foresight so that all have a voice at meetings. This arrogant Melfi thinks nothing of bad-mouthing council members to citizens... and to the Vindicator. Jeez, even State Sen. Ryan is not off-limits. All should be forewarned, NO one is off-limits with this never-wrong so-called Mayor. I highly doubt Melfi will remember my call to him about a problem, and how he bad-mouthed every Council person during my telephone call. He lost my respect that day. IF he runs for ANY political office again, I will vote for anyone BUT HIM. He needs to go--- now. Anyone else want to become Mayor? You'll have my guaranteed vote!

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2ytownsteelman(618 comments)posted 4 years, 6 months ago

We need to rent a uhaul, load up all of Melfi's belongings and drive him to the county line and say never step foot back in this valley again. He could have singlehandedly destroyed the best thing to happen to this valley since Lordstown. What an arrogant ass!

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3pj(80 comments)posted 4 years, 6 months ago

My opinionl Melfi loves stagging.

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4dand1313(20 comments)posted 4 years, 6 months ago

the pure simple fact is...without the existence of v&m which is located within the corporate limits of YOUNGSTOWN, girard's land would undoubtedly be producing nothing but weeds and remain an environment of hazardous waste. no money to the city nor schools. we should first thank ex mayor ungaro for his generation of north star steel, the "seed" which germinated into this project. we should thank all those who made this happen and for taking the first material step in regional cooperation and sharing.

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5CCADTI(80 comments)posted 4 years, 6 months ago

If you take a look at both of these cities, neither one of them have the proper leadership needed or they wouldn't be in the positions they are in. Both cities are run down and even after all the deals are said and done, they will still be run down.

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6dblbogey(17 comments)posted 4 years, 6 months ago

Thanks, Mr Shelby and city council members for caring enough about the Valley and the city of Girard to put this issue to rest.

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7Ken(153 comments)posted 4 years, 6 months ago

Not to worry...there will be nothing to split since I DO NOT think the project will ever get done. Oh, sure, the owners of V&M will make money...but not by making steel; but by taking the money from grants, etc. So, Mayor Melfi, relax because there will be no profits to share!

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8joat(28 comments)posted 4 years, 6 months ago

i second Ken's comments! All of this grandstaging and V&M won't even commit to the project. I would say the ball's now in their court to make a commitment and announce a firm plan for job creation!

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9redvert(2007 comments)posted 4 years, 6 months ago

"From the very beginning, the majority of council approached this as if everything we were told may be true."

These are the words of councilman Shelby. Who would not want to negotiate with someone this naive, you could sell him into paying V&M and Ytown every year!

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10jethead11(139 comments)posted 4 years, 6 months ago

I am glad the deal got done, but you don't see this kind of idiocy in other parts of the country. Most mayors would do backflips if it meant getting that kind of business, tax base, and employment in their community. This one hopefully will work out, but how many other businesses just walked away when the Valley politicians, unions, citizens, etc. started their little "me, me, me" tirades?

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11atek101(77 comments)posted 4 years, 6 months ago

This is fantastic news. It's about time our political leaders got together and made the right decisions for the Valley despite their differences. I'm proud of both Youngstown and Girard for coming to the table and making the right decision for our Valley's working class and business population.

Whether the deal is perfect or not, it represents a necessary collaboration between districts in the Valley and economic progress and opportunity for local businesses and workers. This is a step in the right direction for a region that is known for its fiercely independent political districts.

I don't care if you're from Boardman, Poland, Youngstown, Girard, Liberty, Canfield, etc., we're all part of the Mahoning Valley economic region. Whether you agree with the JEDD concept or not, we have to start thinking like a regional community instead of little fiefdoms if we plan to compete in the global marketplace. Whether we like the idea or not, it's reality. It's about time we started facing it together instead of fighting one another.

As student at YSU who will be looking for career opportunities within the next few years, I want to live in a place that encourages new business opportunities and developments for the region at large, not one that's going to hinder fantastic economic opportunities by bickering between districts over who gets a bigger piece of the pie. I'm glad to see that the my hometown and the Valley as a whole are starting to see the big picture.

When Youngstown and Girard shook hands last night, every city, township and village in the tri-county area gained a better chance to thrive. That's something we can all be proud of.

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12dd933(216 comments)posted 4 years, 6 months ago

atek101 is right. Our valley has been passed over by the global economy. In the three counties Mahoning Trumbull & Columbiana, we have over 70 political jurisdictions that were created over 200 yrs ago. In today's world most of them are a waste of money and time. Look at the cities that thrive economically in the U.S. Portland, Minneapolis/St.Paul, Charlotte, Nashville, Louisville, Indianapolis and even Columbus - all have a regional approach to development (Columbus' uses anexation as a regionalization tool but how many of us have friends & relatives who have moved there?) Indy, Louisville, Charlotte and Nashville have combined city/county gov't & services. Portland and the twin cities have regional governments complete with growth boundaries and tax sharing. neither have good weather - both have high taxes, yet major high tech and biomedical firms locate there because of the atmosphere and the spirit of cooperation that exists.
Even Akron & Summit County do way better than we do - and what do they have that we don't? maybe it's JEDDs!

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13Progress(58 comments)posted 4 years, 6 months ago

Having Melfi involved with the negotiations was what was damaging.

Ask yourselves, what has Melfi done to spur economic development in Girard since he became Mayor??

The reason a majority of council got involved in the first place is because Melfi couldnt be trusted.

Melfi's record on economic development in Girard clearly illustrates that he is the one who lacked the experience necessary to get this done and his juvenile actions and inactions, almost forced V&M to consider another location for the expansion.

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