LORAIN — A $7.1 million borrowing plan that proponents hope will spur waterfront development is expected to be discussed today by City Council at its 6 p.m. meeting.
Under the plan, the money would be paid to the FirstEnergy Corp. for the 1.73 miles of property it owns on and around the Edgewater Substation at 200 Oberlin Ave. The substation, at the intersection of West Erie Avenue, is on prime land for waterfront development. Removing the transmission lines and the nearby Black River water treatment plant, as well as eventually relocating City Hall, are considered keys to development.
Borrowing costs for the 25-year plan are $450,000 annually or about $11.2 million over 25 years for the nearly destitute city of Lorain, which has been under fiscal watch by the state since 2002. Nonetheless, Mayor Chase Ritenauer said it is a good investment.
“It’s up to us to try to eliminate the obstacles and improve the conditions so that development does occur,” he said. “If those lines continue to stay up, we’re going to continue to have very dim prospects for development.”
The borrowing is a follow-up to the city’s move in 2011 selling land at Clifton Avenue and West 30th Street for FirstEnergy to build the new Black River substation. The 138,000-kilovolt substation, expected to be activated in June, will accommodate Republic Steel’s new electric arc furnace. The furnace, expected to be completed later this year, is part of Republic’s $87 million upgrade designed to create about 450 new jobs.
FirstEnergy, which plans to eventually build a 69,000-kilovolt station on the Black River site to replace the Edgewater substation, will spend about $15 million in total construction and decommissioning costs, according to Mark Durbin, a company spokesman. FirstEnergy purchased the Clifton Avenue property for $10 from the city through the Lorain Port Authority and it stands to profit if the waterfront land is developed.
However, Durbin and Ritenauer said it’s unrealistic to expect FirstEnergy, which earned $15.3 million in revenue last year, to sell the Edgewater land to cash-strapped Lorain for a nominal fee. Durbin said FirstEnergy has kept its word, and the deal is “classic private-public partnership” between the corporation and Lorain.
“The whole idea is to look at what can be done to help Lorain redevelop itself, and that’s what we’re working towards,” Durbin said. “But keep in mind, there are times when you have to spend some money to make those redevelopment opportunities happen.”
Contact Evan Goodenow at 329-7129 or email@example.com.