Warren-Trumbull CIC Discusses Going Dormant, Disposing of Assets
VIENNA TOWNSHIP, Ohio — The Warren-Trumbull County Community Improvement Corp. discussed reallocating its approximately $353,000 in assets as it investigates winding down its operations.
While the CIC will not be dissolved, the organization is expected to be placed in inactive status and the majority of its assets put into other uses compatible with its goals.
“The services that the CIC provides are more of a duplication of services that are provided by other organizations,” said Phil O’Hara, chairman of the CIC’s board of directors. “So instead of just continuing to spend our money on administrative expenses, we are looking for a way to get it into the community and some sort of development along the lines of our mission.”
There has been a lot of discussion among members of the strategic planning committee about the CIC’s balance eroding over time because it is spending more money than it is bringing in, said Guy Coviello, president and CEO of the Youngstown/Warren Regional Chamber, which provides administrative services for the CIC.
The CIC was dormant for several years previously, before reactivating to accept the donation of the former RG Steel Building from BDM Holdings LLC in December 2014. That property has since been sold and is now owned by Valley properties, a real estate entity affiliated with MegaJoule Ventures LLC.
The $353,525.82 in assets the CIC lists on its statement of assets include checking and CD accounts totaling more than $145,000, two loans it is collecting payments on from what is now Brite Energy Innovators in Warren, both of which Brite is looking at restructuring and might be paid off in lump sums in the coming months, O’Hara said. It also owns about 20 acres of land near the former Kmart distribution center in Bazetta Township.
Its expenses include the monthly $700 administrative services contract with the Regional Chamber, which collects the loan payments from Brite among other duties, and real estate taxes on the Bazetta property, he said. If the CIC disposes of its assets, the majority of its expenses would be eliminated.
The CIC’s board would continue to meet annually and reactivate should the need arise for the organization to step in and provide a service that wasn’t available from other local organizations, he said.
“If the expectation is to move the organization into dormancy, the CIC should come to its next meeting planning to make a decision on how to proceed,” board member John Moliterno, CEO of the Western Reserve Port Authority, said.
Members of the port authority heard a presentation related to a funding request by representatives of Brite Energy Innovators and the Youngstown/Warren Regional Chamber about a request to fund a collaboration between the two entities.
Under the proposed structure of the agreement, the CIC would provide the partnership $100,000 annually over three years and the Warren Area Chamber of Commerce Economic Development Foundation $50,000 annually over the same period. Beginning in year four, Brite and the chamber would raise $150,000 annually to support the initiative.
Under the proposed First Customer program, the partners would hold quarterly “speed dating” events and other initiatives to connect Brite companies with the chamber’s 2,400 members that could utilize the technologies they are developing to save money and for other applications.
Other action items in the proposal include assisting Brite companies with site selection, incentive packages and other services related to business retention and expansion, providing retention and expansion services to chamber members that use a Brite company, and helping Brite companies relocate to Trumbull County.
By becoming customers of the Brite companies, the chamber members would provide them with both cash and validation, Coviello said. Also, establishing a local customer base would encourage Brite portfolio companies, many of which are based outside Trumbull County, to move here.
“I want us to be seen as a community that is technology forward, that we have companies here that want to move their products forward,” Rick Stockburger, Brite president and CEO, said. “Technology is one of the things that can move them forward.”
A company that is innovating and developing new technology has to balance two pieces, said Dave Martin, founder and president of Intwine Connect, an “Internet of Things” services company and Brite portfolio company.
“One, you’re trying to get investment capital so you can chase your dream. On the other side, eventually somebody has to pay for it. It has to solve a problem,” he continued. Being part of Brite has been a “really big help” for Intwine, which has been able to assist Warren companies with its technology and been able to attract investors.
Board members said they would consider the proposal but also wanted additional information, including about how success would be measured, and wanted to see proposals from other organizations and partnerships about how the CIC’s funds could be used before the board’s next meeting in October.
“It’s a good proposal. We want to see more,” said Mike Keys, Warren community development director.
Following a discussion, the board approved a motion, pending reaching an agreement based on the discussion, to contribute the Bazetta property to the Port Authority, with Moliterno abstaining.
The port authority, which has developed other porters under an agreement it has with the city of Warren, would pursue a project that would “complement that area,” Moliterno said. Such a project likely would provide more benefit in terms of job creation or tax revenue than selling the land to an adjacent business.
“We don’t want to just hold the property. If we would take it, we would do something in terms of a project,” he said.
For several months, the CIC board had entertained a proposal to permit trees to be cleared from the property. Don Thomas, a board member who is managing partner at Platz Realty Group, Canfield, advised against clearing the site before having an end user.
“Timbering a property without a secondary plan is Armageddon,” he said.
Selling the property right away also would cost the community control over what goes there, Coviello said. Moliterno also said the port authority would be agreeable to sharing any proceeds from the sale or development of the property with the CIC.
Copyright 2023 The Business Journal, Youngstown, Ohio.