By RAYMOND L. SMITH
WARREN - Area businessman Sergio DiPaolo claims the city has ignored his efforts to sell it a portion of the former Delphi Packard Electric plant on Dana Street.
City officials have countered that the site would be a better fit for industry.
Instead the administration has been working to convince city council to consider buying a downtown area building as a replacement for 418 S. Main Ave., where the income tax, health and community development departments are located.
DiPaolo, manager of DiPaolo Industrial Development LLC, has been shopping 50,000 square feet of the 120,000-square-foot building. In his most recent communications with the city, DiPaolo offered the completely remodeled and updated space for $5.5 million.
He added, the city could have available to it a state tax credit that could drop the price down to $4.25 million. He did not identify the tax credit.
This is a significant drop in the price for a portion of the former autoparts maker plant.
In October, DiPaolo offered to sell the same location to Warren for $9.5 million when the city was looking to make it a one-stop building for city departments. Council did not express interest in the initial proposal, and city officials have moved away from the one-stop concept.
Since then, city officials have been in discussions with several downtown building owners.
"We want the new building in the city's central business district," Mayor Doug Franklin said.
Based on a bond being considered by council, the price for the properties is in the range of $2 million and $3 million.
Although the price of the Dana Street facility would be higher, DiPaolo argues that everything would be remodeled when the city moves in. He says other buildings that may be in consideration, like the Gibson Building, 258 E. Market St., likely will need repairs and updating in the near future.
Officials have not announced which buildings they are looking to purchase, because they negotiating with the owners.
Franklin said although the Dana Street site is not a good fit for the city, the administration has extolled the virtues of DiPaolo's property to a private company.
"We want it to succeed," Franklin said. "We feel, however, because it is zoned industrial and has rail access, it would be more conducive as a location where new companies can locate and create new jobs, as opposed to taking existing city jobs."
Franklin said the property is not affordable and does not fit the city's location requirements.
Councilman Eddie Colbert, D-7th Ward, said the administration has not approached council members about a revised offer from DiPaolo, but council members have received information directly from DiPaolo in the form of emails.
"I would listen to an offer," Colbert said. "Although I do have issues, because I believe the idea of a one-stop should be centrally located in the downtown area. I honestly believe that area around Dana Street would better serve those in the private sector. We want taxpayer companies producing revenue in that building."
Colbert said there are other, more centrally located buildings, that could serve the city's needs.
Meanwhile, city council is still debating payment options for the proposed bond.
Councilman Jim Valesky suggests the city go for a shorter term bond because the interest rates would significantly increase the repayment costs.
"The total repayment on a 10-year loan for the $2 million new building will be $2.3 million," Valesky said. "The total payment on the same $2 million on a 20-year repayment will be $3 million."
"That is a $700,000 difference," Valesky, D-at large, said.
More discussion about the bonds is slated for this week.