November 20, 2001 at 7:20 PM EST - Updated July 27 at 12:40 AM
LORAIN, Ohio (AP) - U.S. Steel is pulling out of a plan for the Toledo-Lucas County Port Authority to finance much of the $109 million expansion at Lorain Tubular Company.
The Morning Journal reported Tuesday that U.S. Steel, Lorain Tubular's parent company, asked the Ohio Board of Control Monday to defer final approval of a state funding request because U.S. Steel intends to finance the project itself.
The board was set to approve Monday a $5 million loan to the port authority as part of the financing package.
The announcement comes less than a week after the Toledo-Lucas County Port Authority approved the use of $100 million in revenue bonds needed to initiate the mill expansion. The bonds, which were to be guaranteed by U.S. Steel, were to be used for most of the expansion project's equipment.
The Lorain Port Authority's executive director, Richard Novak, said that he was informed late Monday of U.S. Steel's plans to finance the expansion and wouldn't comment further, according to The Morning Journal .
Lorain Tubular's modernization and renovation plan will allow the company to complete final treatment of steel piping made at the plant. The company currently ships piping to Oklahoma for finishing.
Lorain City Council on Oct. 15 unanimously adopted an ordinance giving Lorain Tubular a 10-year, 60-percent tax abatement.
No new jobs are connected with the expansion but under the tax abatement agreement, the company would be required to keep its existing work force at 550 employees.
(Copyright 2001 by The Associated Press. All Rights Reserved.)