Progress at Warren Steel; Cleaning Up, Paying Taxes

WARREN, Ohio – Environmental remediation work is underway at Warren Steel Holding LLC’s site in Champion and Warren townships – a 360-acre industrial property that is tied to an ongoing international fraud investigation.

“We’ve seen some activity in and around the area,” says Doug Emerine, chairman of the Champion Township Trustees. “We’re hoping for some updated reports soon.”

Also, the company has thus far made good on its pledge to clean up more than $750,000 in back taxes and delinquent fees it had accumulated over the years, records show.

The sprawling steel mill, once the Copperweld Steel Corp and then CSC Ltd., is owned in part by Ukrainian oligarch Ihor Kolomoisky. Kolomoisky is alleged to have used Warren Steel and other industrial and real estate assets in the Midwest to launder more than $600 million in the United States that authorities say was fleeced from a Ukrainian bank that he once controlled, according to court documents.

In October 2021, the Trumbull County Treasurer’s office initiated a foreclosure action against the property, citing Warren Steel was delinquent on $409,000 in property taxes.

The action forced Warren Steel to negotiate a repayment agreement with the treasurer’s office, said Sam Lamancusa, Trumbull County treasurer.

“As long as they make payments and keep the contract current, they’re OK,” Lamancusa says. “But if they default on a payment, we open the sheriff sale up.”

Lamancusa said the county negotiated a five-year installment plan with Warren Steel that mandates the company pay a minimum of 10% on its delinquent balance in addition to its regular tax assessments.

“Their delinquency was so big, that’s the way we handled it,” Lamancusa said.

In March, the company made a $43,143 payment on its delinquent tax and a delinquent water charge on 143 acres in Champion Township. This is in addition to a $9,511 payment for first half property taxes.

The company also paid in March $34,215 toward its delinquency on nearly 221 acres in Warren Township, records show. This is on top of a $20,484 payment for first-half taxes.

“They’ll have a second payment due of 10% in August with their current tax bill,” Lamancusa said.

Current records show that Warren Steel owes a net balance of $328,425.63 on the Warren Township land and $397,540.66 on the contiguous Champion acreage.

The treasurer said it’s his experience that those who make it through the second payment most likely will complete the contract and pay their liability in full.

“We’ll see what happens in August,” Lamancusa said.

Warren Steel Holdings permanently shut down in 2016, leaving behind scores of environmental problems and tax delinquencies. In 2019, the Ohio Environmental Protection Agency found abandoned toxic chemicals, oil pits and other hazardous materials in portions of the shuttered mill, nearly four years after it closed.

Warren Steel Holdings purchased the plant out of bankruptcy in 2001 and restarted it in 2009.

However, the plant was saddled with problems from the start. An explosion in 2011 injured several workers, while safety 17 violations piled up between 2011 and 2014, according to records. The mill shut down in 2016, leaving more than 150 out of work.

Meantime, Warren Steel incurred massive fines that included a $1.1 million judgment won by the Ohio Attorney General.

In August 2021, a Trumbull County Common Pleas Court ordered that the company pay the $1.1 million civil penalty and assume the cost of remediation. Both parties reached an agreement on August 9, 2021 — just two days before the case was scheduled to go to trial.

Under the settlement, Warren Steel paid a total of $1,122,852.57 in civil penalties within 30 days of the order, documents say. Of that amount, $472,852 would be paid to the state’s Environmental Protection Remediation Fund, while $150,000.57 is to be paid to Ohio’s Water Pollution Control Administration Fund.

The balance of the penalty — $500,000 – is to be paid to an interest-bearing Supplemental Environmental Project fund, administered by the Eastgate Regional Council of Governments.

The morning of the scheduled trial, a fire broke out in one of the buildings at the site that state inspectors say was set deliberately. The case is still under investigation.

Still, progress is underway at the site, evidence by closure plans presented to the OEPA.

Recent filings by Warren Steel with the OEPA show that the company has submitted plans to remediate hazardous waste from the melt shop water treatment area at a cost of $18,754; a waste pile at a cost of $31,279; and acid tanks at the site’s wastewater treatment plant at a cost of $78,854.

The entire cleanup effort is estimated to cost $878,918, according to OEPA filings.

Cleaning the site is of even more importance to this area of Trumbull County, said Champion Township’s Emerine. The site is positioned at the interchange of state Routes 82 and 45, and less than a mile from where Mercy Health plans to construct its new St. Joseph Hospital near the Kent State University at Trumbull campus.

“We’re hoping that the Mercy Health project would be a catalyst,” Emerine said.

He also noted that Ohio Star Forge, a separate business with no connection to Warren Steel but is located on the site, has in the past expressed interest in acquiring some of the property.

The land could also be a prime target for industrial redevelopment, said Anthony Trevena, executive director of the Western Reserve Port Authority.

“It fits the type of properties we’re interested in,” Trevena said. “It’s a good location and the potential for future development would be great.”

The WRPA helped the OEPA in the cleanup process of contaminated lagoons that studded the property, he said.

“Just seeing them do some work there is good for all of us,” Trevena said.

Pictured at top: Aerial view of plant site.

Copyright 2022 The Business Journal, Youngstown, Ohio.