YOUNGSTOWN — A group of SOBE Thermal Energy System LLC customers trying to save the struggling utility service is considering purchasing it because having it go out of business would be devastating.

The talk of buying the system is preliminary, said Ryan Kelly, co-owner of the Ohio One building, which is one of SOBE’s 28 downtown customers.

“You weigh your options,” he said Friday. “Buying it may be the most feasible option.”

That’s because it will cost about $1 million for each of SOBE’s customers, which make up most of downtown, to retrofit their buildings to get a different utility service, Kelly said.

Kelly said about half of SOBE’s customers are working toward an effort to help the troubled utility company that has been controlled since Sept. 26 by Reg Martin, a court-appointed receiver, because it was about to go out of business.

The company provides steam heating, cooling and hot water services to its customers.

Barb Ewing, CEO of the Youngstown Business Incubator, said: “Some type of cooperative, whether we buy it or some other way, is needed. I’m open to any and all possibilities. If the system collapses and we have to retrofit it, it’s $1 million alone for our building” at 241 W. Federal St. “We’re heavily motivated to find some solution.”

Because of its financial collapse, Ewing said SOBE “is not an attractive company to invest in. It would probably take a nonprofit co-op to step in and protect the businesses downtown.”

To retrofit all of the downtown businesses on the SOBE system, Ewing said, “would cost about $25 (million) to $30 million. It would be more cost-effective (to buy it). I have no preconceived notions on how it looks. We need to be creative and look for our best options. We’re facing winter, and it’s a daunting thought.”

Katie Seminara-DeToro, executive director of OH WOW! The Roger & Gloria Jones Children’s Center for Science & Technology, said any discussion of SOBE customers buying the utility company is “very hypothetical talk. No decisions have been made on where things are headed. Some of the building owners got together last week for the first time. People are exploring all the different options on the table, but nobody has agreed to buy it.”

Martin said he first heard about the possibility of downtown customers buying SOBE from a reporter from The Vindicator asking him about it Friday.

“I’ll entertain all suggestions,” he said. “I’m willing to listen.”

Martin was appointed SOBE receiver Sept. 26 at the request of the Public Utilities Commission of Ohio.

A rented 800-horsepower steam plant that provided utility services for SOBE customers was repossessed Sept. 30 by court order because SOBE owes $383,214 in back payments to the steam plant’s owner.

Martin said SOBE, which was about to go out of business before he took control, is “insolvent” with no assets besides its building and a few pieces of equipment while owing about $4 million to creditors.

Martin was able to get a smaller 650-horsepower rented steam plant a few days after the old one was repossessed. But it took until Oct. 9 for it to operate, leaving customers without steam heat and hot water for 10 days.

Martin said the rented boiler isn’t a final solution. The boiler from Power Mechanical Inc. of Newport News, Virginia, costs $19,750 a month to rent, Martin said.

Martin had contacted Youngstown State University the day before the old plant was repossessed to see if SOBE could use the school’s boiler system through an old piping system. That effort failed Oct. 1 because leaks were found in the system, which hadn’t been used in more than nine years.

Martin said at an Oct. 22 meeting that the main problem could be fixed for about $25,000 because a contractor caused damage to the pipe at the Rayen Avenue and Elm Street intersection. The work should begin next week and take about three days to finish, Martin said.

There could be other smaller leaks on the line with Martin estimated the cost of repairs at $5,000.

But John P. Hyden, YSU’s associate vice president for facility and support services, told The Vindicator on Tuesday that “there’s too many impediments because of the condition we find their lines in. It’s impossible to back-feed their system. The line is leaking so badly. Also, we can only run two boilers at a time and we’re going to use two in the winter. We don’t have the capacity to do it in the winter. It’s not going to happen.”

YSU President Bill Johnson on Friday reiterated what Hyden previously said.

“YSU simply cannot be considered a viable option to provide these services,” Johnson said. “This is not a decision YSU makes quickly or lightly, but rather one dictated by significant technical, infrastructure, financial and operational realities.”

Johnson added that the SOBE pipeline “is in such poor condition that it is impossible to safely back-feed steam from YSU’s system into SOBE’s distribution system.”

Martin said a backup system for SOBE’s customers is needed and had previously talked about renting a 250-horsepower boiler, for about $12,500 a month, to be used with the existing boiler.

The repossessed boiler was 800 horsepower. To rent one of that size would cost about $27,000 a month, Martin said, which would be financially challenging for a company with such limited financial resources.

There still isn’t a backup.

Martin said Friday about a backup: “I’m working on all options. I’m continuing to work on that.”

Also, Youngstown Mayor Jamael Tito Brown and state Rep. Lauren McNally, D-Youngstown, asked Gov. Mike DeWine for emergency relief and / or financial assistance.

Dan Tierney, DeWine’s spokesman, said Tuesday the governor’s office received those letters sent Oct. 23. The two wrote they had no faith that Martin could provide utility services to downtown customers.

Tierney said Tuesday that the governor doesn’t have authority to make an emergency declaration or to provide state funding to run SOBE and the receiver “is the mechanism that is in place” for these issues.

“The receiver is the last resort,” Tierney said. “They’re already there. The ultimate goal is to make sure the utility is operational during the cold season and to eventually find a permanent owner.”

Martin pleaded with city officials at the Oct. 22 meeting to assist him by allowing him to again use a chilling system on the roof of the city-owned 20 Federal Place for the attached Wick Towers, saving SOBE $14,000 a month, and assistance with utility work.

Brown said the city is a customer and not a partner. He rejected the requests.