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After five years of negotiations, Erie County, the City of Lackawanna and the owners of the sprawling Bethlehem Steel property have signed a memorandum of understanding for the cleanup and redevelopment of the prime lakefront site.

The owners will tear down the remaining abandoned buildings and get the 1,000-acre site between Route 5 and Lake Erie ready for development, with about 300 shoreline acres reserved for public use.

The county, meanwhile, will line up $10 million in public funds to put in roads, utilities and recreational facilities.

The on-site operations of Buffalo Crushed Stone, Buffalo Specialty Steel and GTC Inc. will not be affected.

"This project is the psychological lift that this community needs," County Executive Joel A. Giambra said Tuesday evening. "In its day, it was an icon representing the wealth of the community, then it became a symbol of decline. Now we're trying to make it a symbol of opportunity and hope."

The first evidence of progress will be seen within two months as signs go up declaring that the area is available for development, sale or lease. The first section to be offered will be 300 acres along Route 5, which will be the easiest to rehabilitate.

Under the memorandum, Tecumseh Redevelopment, a subsidiary of International Steel Group, which bought the Bethlehem property two years ago, will build an on-site disposal area for construction and demolition debris and contaminated fill, and will continue razing the abandoned buildings.

"By the end of next year," Giambra said, "it's our hope that all the steel production buildings and infrastructure will have been removed."

Giambra said that the $10 million in public funds could come from several sources, including $1 million in Community Development Block Grant funds and $1 million in county funds set aside in the late 1980s.

He added that officials are lobbying for state and federal environmental grants, as well as state money set aside for upstate under the deal that funded the Jacob Javits Convention Center in New York City.

"We're also prepared to commit tobacco money if the rest doesn't materialize -- $8 million would be available," Giambra said.

He noted that, contrary to popular belief, the county's share of the tobacco settlement has not been spent, but is reserved for capital projects.

A 10-year master plan proposes parkland, a marina, restaurants and retail shops in a public area along the lake shore, now covered with piles of slag.

Adjoining it would be a wind energy installation to provide electricity to the new industrial and commercial operations.

Giambra credited Lawrence Rubin, county commissioner of environment and planning, and Lackawanna Mayor Norman L. Polanski Jr. for major help in reaching the agreement.


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