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City Defers $100,000 Grant for $1.15 Million Project
YOUNGSTOWN, Ohio -- The Youngstown Initiative Committee approved financial assistance for four enterprises Wednesday while deferring a decision regarding a fifth application from DNV Energy LLC, an offshoot of Youngstown Pipe and Supply Co., until it resolves issues related to the location of $1.15 million expansion project.
DNV Energy is seeking $100,000 from the city to purchase equipment and machinery, and to cover computer networking costs. The company produces and sells products serving the oil and gas industry including standard valves and fittings as well as custom fabrications, said Vince Pelini, president. The company generally sells to Tier 2 suppliers, he told members of the committee.
“This is not in its infancy. We started this concept in October 2012 and so we are just spinning it off now,” Pelini said. “We’ve done it as a DBA up to this point so it’s been done inside Youngstown Pipe and Supply, and now we’re at the point we want to break it off as its own separate entity.”
The expansion project would create 11 jobs over a three-year period, six full-time and five part-time positions.
DNV Energy operates in the former Cold Metal Products building, which it leases from Gearmar Properties. The building straddles land in Youngstown and Campbell. In 2008, the Initiative program approved a $100,000 grant for Youngstown Pipe and Supply to move into the building, with Youngstown and Campbell sharing the cost of the incentive and the tax revenues.
Although the committee would generally lean toward providing funds for the project, Finance Director David Bozanich said, T. Sharon Woodberry, the city’s economic development director, said there have been no discussions with Campbell.
“Should there be a willingness to participate, they would want to be a part of the process,” Bozanich said. “They would probably frown upon us approving and saying, ‘Give us the money,’ after the fact.” Because of the project location, Campbell would have a “legal claim” to tax revenues generated.
Because employees only pay income tax to Youngstown, Pelini said he thought the issue had been resolved. Bozanich explained that the city redistributes Campbell’s 50% share of the revenues to the city.
Bozanich didn’t expect discussions with Campbell to take long and anticipated the committee would be able to meet next week to take action on the deferred application.
Meanwhile, the Initiative Committee approved $50,941 to support via680 LLC's development of a mobile application for its Ving service.
“People are loving our software as a desktop application, and the ability to do some things on mobile devices and moving into the mobile app arena will literally position us to go after a much bigger market that is expecting all of the applications to work across all devices,” said Tony DeAscentis, via680’s CEO.
The company, which expects to add two full-time and one part-time employee over three years, plans to spend a total $254,709 for the project, according to a project summary. Funds will be spent for software design, creation and implementation; lead generation and engagement software; and trade show attendance.
The Ving service allows customers to send multimedia messages and to track recipients’ level of engagement -- such as whether they opened the email, watched a video or otherwise acted on components of the message. The company, which is on its third major release of the software, has applied for patents following an extensive search and will undergo a review process this spring, DeAscentis said.
“There are definitely companies out there that do a piece of what we do but there are not necessarily companies that do everything that we do,” he said.
The company’s lease at YBI is up in January 2015 but DeAscentis said he is already “scoping out” space on the same floor of the building. For leased space, the city requires a commitment of three years to receive funds.
“We’re clearly staying right there. I’ve been downtown since 1985,” DeAscentis, who previously worked with IBM and Turning Technologies, said. “I’m committed to downtown.”
The committee approved grants for three other companies: Attire Tire Covers LLC, which was awarded $1,888 for its $18,880 project; Happy Campers Learning Center, which received $8,608 to assist with its $86,089 reconstruction project at a Midlothian Boulevard building where it plans to operate, and for necessary equipment and machinery; and Blue Magic Tattoos and Piercings LLC, which received $1,505 for its $7,528 project.
Attire, owned by entrepreneurs Terri Sebastiano and Victoria Chalfant, makes covers for spare tires with interchangeable inserts. “No other company has interchangeable inserts,” Chalfant said. “It’s unique. It’s something that’s not out there.”
The company, which has received a provisional patent and is working on a utility patent, is targeting the Jeep market initially but plans to sell covers for other products that have exterior spares including recreational vehicles and horse trailers.
“We’ve had a great outpouring from Facebook, social media,” Sebastiano said.
“This is the tip of the iceberg for us,” Chalfant added.
Attire will use the city funds to purchase equipment and for marketing. The company has a six-month lease at Oak Hill Collaborative, and agreed to a provision requiring it to be in the city for three years. It is looking at moving to space in a former nearby church the collaborative hopes to purchase. Attire plans to add four full-time and one part time employees over three years.
Blue Magic Tattoos plans to purchase new equipment for its studio, said Tim Adair, owner.
Law Director Martin Hume said he wasn’t in favor of the project and cast the sole dissenting vote on the funding. He questioned the project’s value.
“The value is in bringing younger people downtown,” Woodberry replied.
Copyright 2014 The Business Journal, Youngstown, Ohio.
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