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Ford City enlists public's help in finding solution to default on federal grant

| Tuesday, July 15, 2014, 12:26 a.m.

Ford City Council will be brainstorming to come up with solutions to a $600,000 problem, and, later this week, residents are welcome to join them.

Borough officials will hold a public meeting on Thursday to discuss repayment of a $580,000 federal grant that the borough defaulted on five years ago.

Council has been scrambling this summer to address a demand for repayment from the U.S. Department of Commerce's Economic Development Administration, which gave Ford City the grant to redevelop the former PPG foundry site.

The now-defunct Ford City Community Development Corp. administered the grant, which was given to spur economic development.

Ford City has until Aug. 31 to come up with possible solutions and present them to the EDA, according to a May 1 letter from the agency.

Federal funds threatened

Without a solution, officials said, future financial support may be in jeopardy.

“As it stands currently, Ford City Borough will never get a federal grant,” Councilwoman Vickie Schaub said. “The borough is financially responsible to get this resolved.”

According to the terms of the grant, Ford City had to maintain ownership of the property until 2017.

That didn't happen.

In 2009 — a year after the Ford City Community Development Corp. went bankrupt — Farmers & Merchants Bank foreclosed on the property. The bank, in spring 2010, bought the eight-acre site for $600,000 at a sheriff's sale.

Development at the property continued. It now houses OEM Shades and Belleflex Technologies.

“If it was never foreclosed on, it would have never been in violation,” said Councilman Josh Abernathy. “The only issue is the violation of letting it be foreclosed upon.”

Possible solutions Ford City may present include repayment, property in lieu of payment or leaning on the jobs created by the site to satisfy part of the amount, according to Abernathy.

At this point, council, as well as planning commission members and residents, are considering options.

“We've got to move forward,” Abernathy said. “We need an action plan.”

Julie E. Martin is a staff writer for Trib Total Media. She can be reached at 724-543-1303, ext. 1315 or jmartin@tribweb.com.

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