YOUNGSTOWN B.J. Alan explores options to expand

State regulations and Youngstown's property values could force the fireworks company to move, an official says.
By DON SHILLING
VINDICATOR BUSINESS EDITOR
YOUNGSTOWN -- B.J. Alan Fireworks Co. is looking at expanding its warehouses and offices in Youngstown or moving the company to western Pennsylvania.
The company will take whichever option can be worked out first, said William Weimer, company general counsel. "We're desperate to do something," he said.
The fireworks distributor and sparkler manufacturer needs to add to its corporate staff because of its growth throughout the country, but it doesn't have the office space, he said. It also wants to add warehouse space.
Obstacles: Bruce Zoldan, company president, would prefer to keep the company's 125 workers and 200 additional seasonal employees in Youngstown, but a combination of fireworks regulations in Ohio and financing obstacles may prevent that, Weimer said.
State regulations prevent it from moving the warehouse to another Ohio location because there is a moratorium on granting new fireworks warehouse licenses, he said. It could move to another Youngstown site, but regulations on placing a warehouse are so stringent that it would be difficult to find a site because a warehouse must be certain distances from streets and other buildings.
Staying at its Martin Luther King Boulevard site on the edge of downtown is acceptable but company officials aren't sure financing can be arranged, he said.
The company proposed a $5 million expansion plan in 1996 that would allow it to get rid of the truck trailers that now store many of its fireworks. The state offered a $2 million loan and the company obtained $2 million in private financing.
Weimer said the deal came undone when the state wanted the bank involved to guarantee payment on its part of the loan if the company defaulted. The state was worried that the new building would not be worth enough to cover the loan amount because it was in Youngstown, he said.
Julie Michael, the governor's economic development representative for this region, said the state faces this issue in urban areas across the state because plants built in cities generally are worth less than those in suburbs.
Seeking options: State officials want to keep B.J. Alan in the city, however, and are looking at ways to help it do that, she said. It's too early to say how the collateral issue will factor into any potential deal this time, she said.
One option is involving the Western Reserve Port Authority, which operates the Youngstown-Warren Regional Airport but also has been involved in deals that led to two industrial plants near the airport.
Officials from the state and port authority had preliminary talks about a deal last month, and the state is waiting for more information from the company about what it wants to build, Michael said.
Dino Theofilos, port authority chairman, said the agency now sees itself as a two-county development agency because it is funded by both Mahoning and Trumbull counties.
The port authority is the property owner of the Vienna Township plants, and companies lease the space, which creates some tax advantages for them. Theofilos said the port authority also can issue bonds to assist in financing and can seek a property tax to fund its initiatives, although that is not being pursued now.
Discussions are too preliminary to know what the port authority would do for B.J. Alan, he said.
City involvement: Weimer said company officials are disappointed that they haven't heard from city officials recently because the port authority and nearby cities have called when they heard the company was interested in moving.
Jeff Chagnot, city economic development director, said he hadn't heard the company had expansion plans. In 1996, the city received a grant to do water and sewer work that the company needed and transferred some property to the company for $1.
"We'll do whatever we can to keep them here," Chagnot said.
Weimer said company officials have toured sites in Pennsylvania because the company would not need a license to operate its warehouse. It would only have to comply with building and zoning codes.
The company, which is one of the country's largest fireworks distributors, added nine stores this year. It now has 30 stores, plus hundreds of temporary stands.
shilling@vindy.com