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YOUNGSTOWN - SOBE Thermal Energy Systems LLC disconnected two of its downtown Youngstown customers for failing to pay their bills.
SOBE shut off steam heat service to 22 Market Street Ohio LLC, which is developing the former Mahoning National Bank building, and FNB Youngstown LLC, which owns the First National Bank Building, also known as Central Tower.
The two buildings were disconnected because of failure to pay their bills, which were more than 91 days delinquent as of an Oct. 2 court report filed by receiver John C. Collins and haven't been paid as of Tuesday, said Michael Moran, Collins' attorney.
FNB owes $37,360.25 to SOBE with $26,900.25 of it more than 91 days delinquent, according to the Oct. 2 court report. The same report states 22 Market Street owes $85,551.93 to SOBE with $71,450 of it more than 91 days delinquent.
Also, SOBE is still in negotiations with Dominic Marchionda, who owns two downtown buildings that are also delinquent in paying bills, Moran said.
"Hopefully we'll come to a resolution that will not entail the termination of services," Moran said of Marchionda's buildings.
The two buildings are Erie Terminal Place, owned by Erie Terminal Place LLC, and Wick Tower, owned by West 34 Investors LLC.
The difference between the two Marchionda buildings and the two that were disconnected is the latter doesn't have residential tenants. Each of the Marchionda buildings have 40 housing units while 71 apartment units are being built by 22 Market Street and FNB is planning 64 apartments.
Collins said of 22 Market Street and FNB: "That didn't involve any residential. For us, it's a big difference. With residential, if at all possible, we want to settle the delinquent accounts."
But there's only so long SOBE will wait, Collins and Moran said.
Erie Terminal on Aug. 26 paid $8 - what it was billed monthly for August, September and October 2025 - for its invoice while SOBE states it owes $25,734.97 for two months.
SOBE records show for the past 60 days, Wick owes $10,752.72.
The Public Utilities Commission of Ohio on June 24 granted significant emergency rate increases for SOBE's 23 customers, which make up a majority of downtown Youngstown. The rates took effect June 30.
For 13 of the SOBE's 23 customers, the emergency rate increase for the non-heating season between May and October, was 93% with two at 92%, one at 91% and two at 36%. The five other customers are paying between 64% and 80% more.
Between November and April, the rate will increase by another 162% for 14 of SOBE's 23 customers. One will pay 163% more during those six months with two paying 85% more. The six others will pay increases between 123% and 159%.
Marchionda said bills for his two buildings were considerably more than 92% and Erie has an accurate meter to show how little steam heat it is actually using.
A Mahoning County Common Pleas Court judge on Oct. 7 granted intervenor status to Marchionda's two companies in a case though the PUCO has exclusive jurisdiction over the emergency rate increases.
Collins said since the disconnections, the owner of 22 Market Street hasn't reached out to anyone at SOBE about getting heat restored while FNB made preliminary contact, but hasn't paid.
Moran said of FNB: "We haven't heard anything about what they want to do. We gave a proposal and haven't heard back."
Collins said: "If they won't pay, they'll remain disconnected."
FINANCIAL ISSUES
The rate increases were designed to keep SOBE operating, but that hasn't occurred.
Collins and Moran said SOBE hasn't made any additional money with the huge rate increase because several customers refuse to pay it.
Collins said SOBE will be out of money by late December or early January unless a government bailout saves it from defaulting on even more payments than at present.
SOBE came to a settlement in July with Enbridge Gas Co. for past due bills. The amount was negotiated down from $2,226,662.62 to $724,324.42 with the agreement calling for SOBE to pay $40,240.25 a month, starting in August, for 18 months as well as regular gas bills.
But SOBE doesn't have the money to pay Enbridge and is already two months late with the payment plan, Moran said.
Also, SOBE returned two rented boilers in late July-early August and kept an 800-horsepower boiler, the largest at its Youngstown location, which reduced that monthly cost from $58,000 to $28,400.
SOBE has less than $120,000 left from a $750,000 payment given to it by Enbridge as part of the gas company's $1 million settlement with the PUCO over the Realty Tower explosion investigation. SOBE uses that money to lease the boilers.
A second 800-horsepower boiler is on order, but hasn't arrived from Power Mechanical Inc., the Newport News, Virginia, company that leases the boilers.
That second boiler will double the rental cost for SOBE to $56,800.
Collins said: "We're still waiting on an install date. So far, everything is going well with one 800-horsepower boiler, but we want the redundancy."
If SOBE doesn't hear from Power Mechanical by Friday, Collins said it will reach out to check the status of the other boiler.
In a few months, Collins said, "We won't be able to pay for the boilers, and if we pay for that, we won't have the money to pay utilities and other expenses. It's worse than ever. This company needs funding to get through the winter and I hope we find some kind of funding as quickly as possible. We remain hopeful."
SOBE was put into court-ordered receivership Sept. 26, 2025, after the PUCO determined the utility company could no longer provide services to its customers.
A rented 800-horsepower boiler was repossessed Sept. 30, 2025, from SOBE because the company defaulted on paying for the equipment that provided heat to its 23 downtown customers. That resulted in SOBE abandoning the city with Reg Martin appointed receiver at the request of the PUCO.
But with SOBE customers complaining about service failing a number of times during January and February, the PUCO had Martin removed as receiver with Collins replacing him Feb. 17.