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Vienna's effort to land TV factory falls through



Published: Thu, August 29, 2013 @ 12:15 a.m.

By Ed Runyan

runyan@vindy.com

WARREN

Warren officials are disappointed their efforts to land a flat-screen television manufacturing facility in Vienna employing 500 people didn’t pan out, but they’re hopeful other opportunities with the same company await.

Element Electronics, run by Champion native Mike O’Shaughnessy, will begin production in December in a vacant, 315,000-square-foot facility in Winnsboro, S.C., about 30 miles north of Columbia.

The company, based in Minneapolis, will hire 250 workers the first year and continue hiring in 25-person shifts as training is completed, according to The State newspaper of South Carolina.

The factory is part of Element’s endeavor to return the manufacture of televisions from other countries to the United States, and is possible in part because of Element’s relationship with Wal-Mart, the company said.

Element televisions are available through Wal-Mart, Sam’s Club, Target, Meijer and QVC, the company says.

Warren Mayor Doug Franklin said O’Shaughnessy approached the city in November to see whether a suitable location existed in Warren because he wanted to bring the factory to his hometown.

Franklin said he and safety-service director Enzo Cantalamessa concluded that nothing in Warren would meet their needs (250,000 square feet), but a facility on Ridge Road in Vienna near the Youngstown-Warren Regional Airport would work.

Next, city officials tried to work out a way to acquire the building for Element at no cost to the company.

Because Warren sold $10 million worth of bonds last November to refinance debt and carry out several other projects, it knew it had the ability to take on $4 million worth of debt for Element, Franklin said.

For the city to get reimbursed for the investment, it worked with Vienna Township officials to create a joint economic-development district that would involve payroll deductions being paid to Warren from Element employees. Corporate taxes also would have been involved.

In May, Vienna Township officials passed a resolution appointing Trustee Phil Pegg to work out the JEDD with Warren, though officials wouldn’t discuss specifics of the project.

Various officials say the process stalled after the city asked Element for certain financial information as part of its “due diligence” to ensure that it was a wise investment.

Element was working on a “tight time line” because it wanted to begin production late this year, Franklin said. Cantalamessa “worked tirelessly” to make the project a reality, Franklin added.

“I really do believe we took the necessary steps to make sure we left no stone unturned,” the mayor said.

The work still could pay off with Element and with Vienna Township later, Franklin said.

Pegg said Vienna needed Warren to make the project happen because Vienna doesn’t have the authority under Ohio law to purchase a building for a private company the way Warren could, nor could Vienna enact a payroll tax.

“We were going to participate in a JEDD,” Pegg said. “We let Element know we wanted the work, and we would have created a JEDD, but the project was never completed.”

Tony Paglia, vice president for government affairs for the Youngstown/Warren Regional Chamber, said Element insisted that to bring the assembly of televisions back to the United States, it would need to have a free building.

Paglia said that was “difficult to overcome,” and a free building is rare in the history of Mahoning Valley economic development.

“It’s hard to come up with that kind of money,” Paglia said.

In a news release, O’Shaughnessy praised South Carolina Gov. Nikki Haley for helping to make the deal in South Carolina come together in “just a few short months.”


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