City withdraws plans to sue corporation

Additional grants and loans from the state will pay the city's bill.
By VIRGINIA ROSS
VINDICATOR CORRESPONDENT
NEW CASTLE, Pa. -- City council has decided to suspend its plans to sue the Lawrence County Economic Development Corp. for money the corporation owes the city for the construction of the sewer line for Millennium Park.
At a meeting last week, council withdrew a summons the city filed Nov. 15 in common pleas court informing the corporation that a civil suit was being brought against it.
Council had initiated the litigation to seek reimbursement of $1.3 million owed the city for the construction of the sewer line at the proposed industrial site in Neshannock Township.
City officials said since the filing of that summons, the corporation has been able to secure $7.5 million in funds from a Business in Our Sites grant program and a state loan. But, for the corporation to receive the money, the city had to withdraw the summons.
"This is the best way to handle this, & quot; said Rob Ratkovich, council president.
Two years ago the city agreed to accommodate the corporation by altering its West Bank Super Sewer project by using 42-inch sewer lines for the industrial park. The project had been designed with 36-inch lines.
Last year the corporation agreed to reimburse the city nearly $1.3 million for the increase in sewer line size. The city paid the contractor for the sewer line construction.
What went wrong
City officials said the corporation had agreed to reimburse the city in full by the end of last November.
However, Linda Nitch, executive director of the Lawrence County Economic Development Corp., said the corporation had not received enough money from the state to pay the debt by that deadline.
City officials said the corporation will receive a $3.75 million Business In Our Sites grant and $3.75 in loans for the completion of the industrial park.
Once that money is received, between April 1 and June 30, the corporation will be able to get additional funding and a line of credit. Council members said the corporation has agreed to reimburse the city by June 30.