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A deal for an $81.5 million plant in Youngstown is expected to be finalized today
YOUNGSTOWN
A deal for a Vallourec Star sister company to build an $81.5 million steel-pipe threading plant in the city is expected to be finalized today.
The city’s board of control is to vote today on an agreement with the company, VAM USA LLC.
The company plans to hire 84 full-time workers by next year with an estimated payroll of $2.9 million to $3.7 million, according to its tax-abatement application.
The agreement proposal was put on the board’s agenda at the request of the company, said city Finance Director David Bozanich, who sits on the board of control with Mayor John A. McNally and Law Director Martin Hume.
“We’re putting the land-purchase agreement [on the agenda] in anticipation the project can move forward, and we’re hopeful it will move forward,” Bozanich said. “This will finalize the contract. Should they decide to go forward, they need an agreement done promptly. We’re optimistic” it will be finalized today.
There was a question as to whether VAM would lease or purchase the property based on the level of soil contamination on the Ohio Works Business Park location, which used to house a steel mill.
Testing of the soil done by a company hired by VAM showed there isn’t a contamination issue, Bozanich said.
The company will pay $350,000 to $360,000 to the city for 7.8 acres.
The city’s financial incentive package to get VAM to build in the Ohio Works Business Park includes a 10-year, 75-percent real-property-tax abatement, a $369,000 water and wastewater grant for infrastructure and a retention pond to prevent flooding, and not requiring the company to pay water and wastewater tap-in fees and permits.
VAM would build on the former Genmak Steel building site that’s been vacant for a few years.
The facility likely would have two threading lines, and would take about 16 months to complete from the start of construction.
VAM declined Wednesday to comment through a local spokesman. Previously, the company’s lone statement confirmed it was in “active negotiations” with the city “to secure property for a potential pipe-processing facility on Ohio Works Drive.”
The new facility would be about a mile from Vallourec Star’s $1.1 billion expansion mill that opened in October 2012.
VAM USA is a joint venture among Vallourec, Nippon Steel Sumitomo Metals Corp. and Sumitomo Corp.