Oakhill purchase divides officials

Some financial questions remain unanswered, three officeholders said.
By PETER H. MILLIKEN
VINDICATOR STAFF WRITER
YOUNGSTOWN -- The Mahoning County administrator and the chairman of the Mahoning County commissioners say the county's acquisition of Oakhill Renaissance Place will be beneficial to the taxpayers, but three other county officials remain skeptical.
"We'll be paying ourselves rent and earning revenues towards the county as opposed to paying landlords throughout the county," said Anthony Traficanti, chairman of the board of county commissioners.
The first step, Traficanti said, would be to move the county Department of Job and Family Services, including the county's Child Support Enforcement Agency, from Garland Plaza to Oakhill. "We're going to do things in phases," he said.
Together, JFS and CSEA incur annual occupancy costs of $1.3 million for rent, utilities, repairs, maintenance and security at Garland Plaza, said George Tablack, county administrator. "By partnering them with the existing tenants of Southside Hospital, there will be economies of scale," he said.
Sale approved
Traficanti and Tablack made their remarks after U.S. Bankruptcy Judge Kay Woods approved the sale of Oakhill to the county, which was the only bidder, in an hourlong hearing Wednesday morning.
The county has agreed to buy Oakhill, which is the former Forum Health Southside Medical Center, 345 Oak Hill Ave., in as-is condition for $75,000 due at closing on Tuesday. The county would also be responsible for more than $900,000 worth of mortgages and liens.
A resolution to approve execution of the purchase agreement is on the agenda for today's 10 a.m. county commissioners' meeting in the county courthouse basement.
Oakhill's owner, the nonprofit Southside Community Development Corp., filed for Chapter 7 liquidation bankruptcy May 3, and bankruptcy trustee Andrew W. Suhar told the court he will have exhausted as of Tuesday the $100,000 he borrowed from Chase Bank to keep the building open.
As requested by Suhar, Judge Woods terminated the leases of Oakhill's nine tenants. The county asked that the leases be terminated so the county could renegotiate them, Suhar said. The tenants will remain on a month-to-month basis, Suhar added.
Among the building's occupants are the Youngstown Health Department and county coroner's office. "We're looking forward to keeping our tenants there," Traficanti said.
If the county weren't going to acquire the building, Tablack estimated that it would cost the coroner's office between $500,000 and $1.5 million to relocate immediately.
Tablack also said Oakhill's utility costs have fallen about 50 percent since Mahoning Valley Hospital, which operated there 24 hours a day, moved out of Oakhill in May. The remaining occupants of Oakhill operate primarily during regular business hours.
Tablack noted that the former Robinson Memorial Hospital building in Ravenna has been a Portage County administration building for more than 25 years. "There's certainly precedent for this type of transaction," he observed.
Tablack also said the Oakhill building will provide on-premises day care for county employees working there.
Reservations
Judge Woods granted a motion by county Prosecutor Paul Gains to dismiss an objection to the sale. The objection was filed by Auditor Michael V. Sciortino, Treasurer John B. Reardon and Commissioner John A. McNally, all of whom said after court that they remain skeptical about the county's purchase of the property.
The three officeholders said too many financial questions remain unanswered about the purchase and called for an independent analysis of the building's condition and renovation and operating costs before the county takes possession.
McNally was the sole dissenter when Traficanti and Commissioner David N. Ludt voted in May to take responsibility for the $430,000 Ohio Department of Development loan to SCDC.
Tablack said the county intends to petition Gov. Bob Taft to forgive that loan because, as a government center, Oakhill will primarily benefit state-funded programs. A $400,000 real estate tax bill for Oakhill is under appeal and may be forgiven by the Ohio Department of Taxation, Tablack added.
Gains argued that the objecting officials lacked standing to file the objection because they didn't have a personal interest in the sale and because they have no authority to challenge a decision by the majority of the three county commissioners to buy real estate.
McNally argued unsuccessfully that he had standing because he has the right, as an elected county official, to express his views to the court.
"I still question the financial wisdom of this deal," McNally said. "It'll probably be a few years before we know" in full how the Oakhill acquisition will affect the county, he added.
"We wanted to put ourselves on record as opposing this project because of an incredible lack of due diligence," Reardon said. "Nobody knows how much money it will cost the county to assume ownership of this building and to operate it, nor are we aware of when those funds will be required, and that is not financially prudent,'' he added.
"No plan has been presented to the auditor's office in terms of where the money is coming from and how the county is going to pay for this project long term," Sciortino said.
But Raymond Jaminet, who did architectural work for SCDC, said he was pleased with the judge's decision because the alternative -- a boarded-up 353,184-square-foot building -- would have been "absolutely a disaster" that would have invited vagrants and thieves.
He added that the building could not survive a single winter without being heated, and demolition costs could have approached $5 million.
The county is the most logical developer of the Oakhill building because it has numerous county offices it "could put in there under one roof," he said.