Mayor: New jobs make sense

Published 12:00 am Wednesday, June 25, 2003

Mayor Bob Cleary hopes to set the record straight about the financial cost to the city regarding Our Lady of Bellefonte's recent decision to move 50 jobs to the Ironton City Center.

A recent editorial in The Ironton Tribune questioned whether the benefits of these office and administrative positions outweigh the investments of city funds and grant monies, which are derived from tax dollars, that will be needed to to develop the 8,000 square foot fourth floor.

For Cleary and Economic Development Director Matt Ward, the answer is a resounding yes.

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Before the deal can be finalized, it will require an investment by the city of $150,000 that will be bonded out. The city is in the application process for funds from Community Development Block Grant monies, the Governor's Office of Appalachia grants, Empowerment Zone funds and business stimulus grants through the Ohio Department of Development

Renovations to the building are projected to cost approximately $340,000 to develop the office space and an additional $212,000 to provide the communications system, Cleary said.

In addition to the payroll tax generated by having more people work in the city, the hospital will pay rent for its space and will create more commerce in downtown, Cleary said.

"In economic development, you have to have a traffic generator," Cleary

said. "When you show other properties in downtown, they look at the traffic numbers. These 50 jobs will add to that."

The rent price is still being negotiated, but will increase each year for the life of the 8 year contract, as well as the 5-year renewal period, Cleary said.

"It is our intention that the debt that we incur will be totally paid off in the first eight years of the lease," he said.

As the debt is paid off, the city will have additional funds each year that will go into the general budget, he said.

The 60 to 65 new or relocated positions will combine with the 20 currently filled at Bellefonte's Diagnostic Imaging Center to total approximately $2.7 million in annual payroll.

Once these positions are a part of the city for a full-year, the city's 1-percent payroll tax will put approximately $27,000 in the city's coffers, City Finance Director Cindy Anderson said.

This tax base will help offset the approximately $60,000 recently lost when Boyd County, Ky. passed its own payroll tax, she said.

Ward has worked on this project for months. He sees it as a big positive step for both the downtown business community and the hospital.

"The city will absolutely make money, especially by the end of the term of the lease," he said.

"Everything that comes out of the city's pocket will be recouped in a relatively short amount of time. It is a small advantage for a huge gain."

The communications system will include a microwave system that will allow Bellefonte and other businesses to communicate with Kentucky, West Virginia, Portsmouth and more without paying for fiber optics or long-distance fees. This will be used as a draw for other potential clients, Ward said.

"The microwave system will level the playing field with the rest of the Tri-State," he said. "We can expand to accommodate whatever business wants to be here."

Providing more than 25,000 lines of communication, Bellefonte will only require about 60, he said.

Because of the 50 new jobs, the city may invest more funds on a $250,000 parking improvement project behind the City Center.

The plan is to use some city funds as well as Empowerment Zone and other grant monies, Cleary said.

As far as using the state and federal grants that is derived from taxes, Cleary said that these funds are there for that purpose and that if Ironton did not use them some other community would

"These grant funds are set aside to make a better community, help economic development and create jobs," he said. "City tax dollars have nothing to do with this project."

Overall, this will stimulate the downtown economy, Ward said.

"You will have 50 more people spending money in downtown Ironton," he said. "For several businesses downtown, this is like heaven. Everyone I have talked to is saying this is great."

Joe Unger, owner of Unger's Shoe Store across the street from the City Center, attended last week's press conference and is excited about what this means to businesses like his and businesses that may consider locating there.

These people are going to have to eat somewhere, they may have to run to the drugstore, go to the hardware store or they may see a pair of shoes they like in the window, he said.

"What this does is bring 50 more shoppers a day to downtown Ironton," he said. "How can any business argue with that?