Pipe mill promises 80 new jobs

YOUNGSTOWN – The new $81.5 million pipe threading mill that will be built here beginning next month will bring at least 80 new jobs and $2.9 million in annual payroll to the local economy, according to information released Thursday.

VAM USA LLC also will generate about $250,000 a year in Youngstown city income tax, $400,000 to $500,000 in annual real estate taxes for Youngstown City Schools, and revenue from building permits and increased usage of water and sanitary sewer utilities, said Youngstown Finance Director Dave Bozanich.

And that’s all with the 10-year, 75 percent abatement granted by local government in exchange for the investment and job creation.

The company also will pay Youngstown $365,000 to purchase two parcels of city-owned land adjacent to the industrial site at 1053 Ohio Works Drive, where the new mill will be built.

The investment by the Houston-based sister company to the Vallourec Star pipe mill was confirmed and announced Thursday morning by Youngstown Mayor John McNally. He called the company a “great corporate citizen.”

Work on the mill is expected to be under way by April 1 and wrap up September 2015, according to an Ohio Enterprise Zone Agreement approved Thursday morning by the Youngstown Board of Control.

“It’s another huge win for the Mahoning Valley,” said Sarah Boyarko, vice president of Economic Development, North America, for the Youngstown-Warren Regional Chamber. “I think it speaks volumes that they continue to invest in the city of Youngstown.”

Boyarko was involved in months of negotiations that also involved the city and JobsOhio, a private board that acts as the state’s economic development agency.

The mill will be built on an industrial site previously occupied by Genmak Steel LLC. The building has been vacant for a few years, and public documents released by the city indicate VAM USA plans to renovate the building and expand it.

In addition to the approximately 80 new permanent mill jobs – about 65 hourly manufacturing jobs and the rest management – about 400 more skilled trades workers are expected to be called in to build and renovate the facility over the next 18 months.

Don Crane, president of the Western Reserve Building Trades, said the company has committed to using organized local building trades to do the work. Crane said he expects work to begin soon and hopes poor weather does not slow the process.

“As far as the building, they need to get started there as soon as possible,” Crane said. “Obviously, the weather is always an issue, especially when you work on an outside project like this, but our membership has worked in the area all the time and knows what to expect.”

A contract for the initial construction has been inked with a Toledo-based company, but local tradesmen will do the work, Crane said.

VAM USA LLC is a joint venture among Vallourec Star, Nippon Steel and Sumitomo Metals. Vallourec Star already has invested more than $1 billion in its new pipe mill on the site of the former Brier Hill works near the Youngstown-Girard border. The company employs more than 800 workers making pipes used in oil and natural gas drilling.

When contacted Thursday, the company declined to release a statement about the new project.

It was only a short time after the announcement that city and economic development officials already were thinking about future potential.

“We think they (Vallourec) have been a great corporate citizen in terms of the investment they brought in here, the jobs,” Bozanich said. “We are going to make sure we continue to create an environment to make sure they want to spend more money in Youngstown, Ohio.”

McNally agreed. “We are looking forward hopefully to some projects down the road.”

When asked about future growth potential, Boyarko said, “I would think that they probably are considering all options at this point and looking at all opportunities that will support the mills.”

Speculation has existed for several years that the company is considering construction of a new melt shop. The company, however, has remained mum on that.

Boyarko noted that suppliers and other companies considering moves to the Youngstown-Warren area often are spurred by announcements like this to move more quickly.

“It’s important to use all the good news to develop and diversify,” she said. “This is a great thing to add to our list of positives that we are experiencing.”