Think twice about purchase from developer who’s indicted

The Western Reserve Port Authority is moving forward with its plans to purchase the former Harshman law firm building in Youngstown from NYO Property Group for $350,000.

The board that oversees operations at the Youngstown-Warren Regional Airport and an economic development arm is seeking financing, and then plans to invest up to $325,000 more to renovate the building located at 101 E. Boardman St.

The port authority plans to lease some of the building to Eastern Gateway Community College and to use part of it for its own office space for its economic development arm. Port officials also have said they are in discussions with a potential commercial tenant and they expect most of the building to be occupied by the end of next summer.

It all may sound good on the surface, but we wonder why officials at this publicly funded organization seem to see no problem with the fact that they are negotiating and purchasing a building from NYO Properties, headed by prominent area developer Dominic Marchionda, who is now under criminal indictment on charges alleging money laundering and related crimes to support his lavish lifestyle. The 105-count indictment filed Oct. 2 against Marchionda and several of his affiliated businesses alleges multiple counts of aggravated theft, receiving stolen property, tampering with records, telecommunications fraud, money laundering and engaging in a pattern of corrupt activity.

According to the indictment, Marchionda is accused of using tens of thousands of dollars obtained through public grants to buy personal items. It also alleges he submitted falsified payroll sheets to obtain funding for projects, and alleges a bribe to a not-yet-named Youngstown public official. He also has been accused of running a Ponzi scheme using a number of companies to funnel government money and faces felony counts alleging misuse of Youngstown water funds and float loan money.

Of course, Marchionda remains innocent until proven guilty, but the charges alone should be enough to make most officials in the public sector turn tail and run, if only in an effort to avoid public scrutiny and any appearance of impropriety. Instead, however, port authority Executive Director John Moliterno said he doesn’t see any impact on the purchase, and points out that negotiations were under way before the indictment was filed. Certainly, he understands the indictment alleges improper use of funds dating back several years.

It’s also worth noting that NYO Properties also owns Penguin Place in Youngstown, where the port authority’s economic offices now are located.

Corruption involving public officials and public funds is nothing new to our area, and the latest allegations involving Marchionda are just a new black eye for the Youngstown-Warren region. Public officials need to take a stand against corruption, not give a pass because a deal was struck before charges became official.

We believe the Port Authority should think hard about the appearance of this deal, not only to those already living and doing business in the Mahoning Valley, but to those outside our area who may be considering business dealings here.