SOBE steam plant repossessed

YOUNGSTOWN — A company-owed $383,214 by SOBE Thermal Energy Systems LLC in nonpayments repossessed the mobile steam plant used to provide utility services to much of downtown, with a boiler at Youngstown State University providing service to them at least temporarily.
Kenneth R. Goldberg, an attorney representing Reg Martin, SOBE’s court-appointed receiver, filed a brief stay of execution Tuesday with Judge Anthony Donofrio of Mahoning County Common Pleas Court to stop the repossession of the mobile plant by Wabash Power Equipment Co. But that court filing at 3:05 p.m. came hours after Wabash, of Wheeling, Illinois, started removing its equipment but hadn’t finished.
That left Martin and the Public Utilities Commission of Ohio, which urged Donofrio to appoint Martin as receiver, to work out at least a short-term deal with Youngstown State University to use the smaller of its two boilers to provide heating, cooling and hot water to the 27 downtown buildings, including two structures with 90 residents.
“The service was turned off as Wabash took its equipment,” said Matt Schilling, PUCO spokesman. “We’re in talks with the receiver and the city and with Youngstown State University,” he said.
The PUCO wants a short-term and a long-term solution, Schilling said.
The length of the deal with YSU wasn’t known by PUCO or university officials.
YSU’s smaller boiler has capacity to handle the downtown customers, said Jason Small, a city senior assistant law director.
Small was involved in the two-week extension, which ended early Tuesday, for Wabash to let SOBE continue to use its mobile plant with the city paying $20,000 to the company.
City hall, the main downtown fire station and the police station are all SOBE customers.
After Wabash pulled its equipment, downtown customers were without heating, cooling and hot water services. Some were restored later Tuesday while it might not be until today or Thursday before all customers are back online with the YSU boiler.
The PUCO is working to get a mobile steam plant unit and probably a backup to provide redundancy for SOBE’s customers, Small said.
After Wabash took back its mobile plant, Goldberg, who is Martin’s court-appointed legal counsel as SOBE’s receiver, filed a Tuesday motion asking Donofrio to stop the repossession court judgment for Martin “to develop and facilitate a plan to ensure that service continues for SOBE’s customers. The receiver is asking for a stay of at least 30 days.”
Goldberg also filed a separate Tuesday motion for an expedited hearing on the motion.
Goldberg didn’t respond to requests Tuesday to comment.
SOBE breached a lease agreement with Wabash for the steam plant at its Youngstown facility, 205 North Ave. SOBE signed a lease in November 2019 to use Wabash’s steam plant at $19,500 a month.
A federal judge ruled Jan. 29 in favor of Wabash’s motion for default judgment of $383,214 when SOBE never responded to the case. Wabash then filed May 23 in Mahoning common pleas to repossess and remove the equipment after SOBE refused many demands for the property, according to court documents.
The repossession was delayed a few times since Donofrio granted a default judgment Aug. 21 against SOBE, which didn’t respond to the lawsuit.
Donofrio on Sept. 9 rejected an Aug. 29 motion by the PUCO to reopen the docket and seek a stay of execution in the case won by Wabash. Wabash had responded that it had voluntarily permitted SOBE to use its equipment until at least Sept. 16.
The city on Sept. 9 filed a motion to intervene “to ensure the health, safety and welfare of residents and businesses in downtown Youngstown,” and sought a stay of the judgment of at least 30 days. A settlement was reached Sept. 16 for the city to pay $20,000 to Wabash to keep the mobile steam plant at SOBE until Tuesday.
With Martin, who lives in the Columbus area, running the day-to-day operations at SOBE since a Friday court ruling by Donofrio in favor of the PUCO’s request for a receiver, the city is now just a customer and didn’t extend the Wabash deal.
Martin also served as receiver from 2017 to 2019 when the downtown utility, then operated by Youngstown Thermal LLC, financially failed.
Martin was named receiver of Youngstown Thermal after the PUCO was informed by the company’s CEO that the business was financially failing, which could have caused an energy crisis downtown.
By 2017, Youngstown Thermal, which had numerous problems for years providing service, could no longer ensure adequate service to its customers and was in danger of insolvency when the PUCO stepped in and appointed Martin.
When Martin was Youngstown Thermal’s receiver, the PUCO granted him permission for an additional surcharge on customers.
Martin was the receiver for two years before he worked out a deal with SOBE, based in Dublin, Ohio, to manage the facility in 2019. SOBE purchased the assets for $250,000 in November 2021.
But SOBE has since experienced a number of financial problems and can no longer effectively provide utility services to its customers.
This is the oldest district heating and cooling system in the country, having begun operations in 1895. It was designed to generate and distribute steam to heat downtown businesses using coal as its main source of fuel.