Officials must work to ensure success of V&M’s expansion

Here’s hoping that Youngstown and Girard succeed in going back to the future to forge robust economic development for the Mahoning Valley.

Steelmaking, synonymous with the heyday of our region’s industrial livelihood, could be making a comeback — in a colossal way. The largest heavy industrial-manufacturing project in Youngstown and Girard in decades is fast gaining steam.

Specifically, V&M Star Steel, a division of Vallourec and Mannesmann Tubes of France, is considering a massive $600 million-plus expansion at its Martin Luther King Jr. Boulevard mill, once the site of the mighty Brier Hill Works of the Youngstown Sheet & Tube Co, which straddles the borders of the two cities. The expansion could end up totaling close to $1 billion in investment and creating as many as 1,000 good-paying jobs, some say.

But lest we get caught up too soon in euphoric false hopes, one must stay grounded in the realization that the proposed expansion is not a done deal. That’s why it is incumbent upon Youngstown Mayor Jay Williams, Girard Mayor James Melfi, state and regional economic development leaders and the community to continue to work cooperatively with officials of V&M, the world market leader in the production of hot rolled steel tubes for all applications.

Positive results

So far, such cooperation has been exemplary and has produced positive, tangible and hopeful results. From Columbus, the Ohio Tax Credit Authority earlier this week approved tax incentives valued at an estimated $2.6 million. The board unanimously approved a 10-year, 75 percent tax credit for V&M, with the benefit starting in January 2010. In return, V&M would commit to steelmaking at its Valley site for at least 20 years.

From the Valley, Youngstown and Girard have entered into a Joint Economic Development Zone agreement to ensure cooperation between the two cities and to plan for such details as taxation, water supply, land acquisition and other mutual concerns surrounding the expansion. We commend the officials, particularly Williams and Melfi, for working expeditiously and aggressively to prove to naysayers the concrete value of partnerships to stimulate regional growth.

The stakes are indeed high. As Williams pointed out, “If this project comes to fruition, it will be as impactful to the Mahoning Valley as anything we’ve seen probably in the past 20 years or so.”

Melfi adds, “We are talking about millions and millions of dollars being dropped on this area like a bomb.”

In addition to the behind-the-scenes cooperative success of Williams, Melfi and the state, other factors ought to work in the Valley’s favor to secure this project. For one, many economists point to a resurgence in manufacturing in the United States because changes in the global economy have made America and even its diehard Rust Belt cities more attractive. The weak dollar, more cooperative relationships between America’s workers and managers and the rising costs of labor in China have combined to make U.S. products more price competitive. Just in the past year, evidence of a steel manufacturing renaissance has taken hold in the Valley. Severstahl Steel of Russia has taken over and is investing in the future of the former WCI Steel mill in Warren. Too, the former Copperweld Steel plant has reopened as Warren Steel Holdings.

Natural assets

Additionally, Youngstown, Girard and the Valley continue to boast longstanding natural assets. Among them are our central location between Chicago and New York, our strong network of interstate highways, our large and skilled work force and our low cost of living. State and local officials must continue to enunciate those and other assets to V&M officials.