Council OKs tax break for GM

THE VINDICATOR, YOUNGSTOWN
Trumbull County commissioners are expected to vote on the abatement agreement Wednesday.
By DENISE DICK
VINDICATOR TRUMBULL STAFF
LORDSTOWN -- A tax abatement agreement on a proposed $500 million renovation of the General Motors Assembly Plant has one more hurdle to clear.
Village council unanimously approved the 10-year abatement for the company Monday. GM officials said Trumbull County commissioners are expected to vote on the abatement Wednesday.
The board of education and schools oversight commission approved the agreement last month.
"I feel this is a win-win-win for Lordstown village, Lordstown schools and the Valley and especially for the GM plant," said Mayor Arno Hill.
Criticism: One resident, Philip Tobin of Huffman Road, disagreed.
"You're giving a tax abatement to the second-richest corporation in the country," he said, also pointing to jobs cut at the facility.
"I don't envy you people, and I don't see it as a win-win," Tobin said.
He was the only resident to speak against the abatement agreement at any of the public meetings where it was approved.
Jim Graham, president of UAW Local 1112, acknowledged that no one likes abatements. But he said if the company doesn't get an abatement in Lordstown, many other communities would be eager to approve similar agreements to attract the company. That would mean the loss of GM and $1 billion gouged out of the local economy.
"The bottom line is GM has to stay here, and we will get a new product," Graham said. "We're that confident."
What it does: The agreement gives the company a 75 percent abatement of the property taxes that would have gone to the school district. The village and Trumbull County are to give the company a 100 percent abatement under the plan.
The agreement also gives the school district half of the tax money that would have gone to the village and county if a 75 percent abatement had been approved.
Under Ohio law, a corporation may receive an abatement of up to 75 percent without the affected school district's approval if the governmental entity and the county affected approve it.
The agreement is contingent on GM's Lordstown plant being renovated. The plan for plant renovation, estimated at between $300 million and $500 million, calls for a new paint shop and the reconfiguration of most departments.
Building a case: GM will present the abatement to company leadership as part of its business case to try to get a commitment to renovate the plant.
Another element was a four-year contract approved by workers in January that would take effect after the current pact expires in 2003 if the renovation is approved by the company leadership.
Union officials hope GM commits to renovating the plant and building the next generation of small cars at the Lordstown facility.
The company has committed to making the Chevrolet Cavalier there for three more years but hasn't extended its commitment beyond that. The Lordstown plant employs roughly 4,600 hourly workers.